Online gambling payment processors are hard to find, expensive to use, and one of the biggest challenges when it comes to setting up an online casino. This is true whether you’re operating through a domestic entity or you’re trying to secure merchant accounts for international companies registered in offshore jurisdictions.
Simply put: Securing payment processing for gambling operations is extremely difficult and time consuming. So, in this article, we’ll share why merchant accounts are so tough for gambling operations and how to navigate the limited options that do exist.
Feel free to use the table of contents to jump ahead to any sections that are immediately relevant to your search.
Table of Contents
- Gambling Payment Processing 101
- Gambling Payment Gateway Options
- Frequently Asked Questions
- Ready to Explore Your Options?
Gambling Payment Processing 101
From a banking and financial services perspective, online gambling is considered very high-risk. In short, this is due to the industry’s susceptibility to money laundering, fraud, and support for other criminal activities.
With this in mind, it can be very difficult for online gambling companies to find acceptable payment processors to support their transaction activities. This is true whether the online casino supports a specific jurisdiction (e.g. a specific US state) or a broad market (e.g. accepts international clients).
For example, around half of all US states have legalized “iGaming” or online gambling sites, making it a growing domestic industry in the United States. However, traditional payment processors that support low-risk e-commerce businesses are not a suitable option for processing payments to online gambling sites. In large part, this is because traditional merchants do not have the required compliance and onboarding procedures in place to verify transactions in a higher-risk industry like gambling.
Most online gambling sites will instead need to consider specialty payment processing platforms that have clearly stated they are willing to accept an online casino as a client.
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Gambling Payment Gateway Options
The specific gambling payment gateways that you might want to consider depend on your answers to a number of different questions. We’ve broken down some of the initial questions to help you get a better sense of your business’s risk profile before you start approaching payment processors.
Company Specific Variables
- Where is the company registered?
- Where is the company licensed?
- Where does the company operate?
Transaction-Related Questions:
- What form of payment does the company need to accept?
- How many incoming and outgoing transactions will be processed monthly?
- What is the total value of transactions being processed?
Client-Related Questions:
- Where are the customers located?
- What KYC & AML procedures are in place?
- What systems are in place to identify fraudulent activity?
- What safeguards are in place to protect innocent customers?
Online Gambling Merchant
The above questions are basic considerations that any financial institution will look at before considering onboarding your company. However, they are far from a complete list of the questions that you will need to answer during the onboarding process with a high-risk payment processor.
With this in mind, we also wanted to share another important consideration… cost.
Many high-risk payment processors will charge application and onboarding fees to businesses before they will consider their application. This is not always the case, but it is something to keep in mind, especially if you are considering offshore payment processors that almost exclusively cater to high-risk entities.
Frequently Asked Questions
Below are two of the most common questions that we receive from people looking for online gambling payment processors. If you have further questions you would like answered, don’t hesitate to get in touch with us directly.
What Is the Best Payment Processing for Gambling Companies?
The best payment processing option for gambling companies will ultimately depend on a range of different factors, including the country of registration, licensing, and operation. Additionally, the jurisdictions where your customers are based and the transaction activity can all influence which payment processors will consider onboarding your business.
Are There Any Free Payment Processors?
Payment processors usually charge a small fee in order to offset the costs of processing payments through various networks, included in this fee is their profit margin. In most cases, these fees are negligible compared to the value of the transaction. However, in high-risk industries like online gambling, these fees can be much higher. With this in mind, there are no free payment processors available, especially when your business is involved in high-risk business activities.
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