In order to run profitable businesses, online gaming merchants need to have reliable and safe payment gateways. Players need to be able to securely use credit or debit cards to make purchases on the casino sites. This is a simple standard, but one that comes with a bit of red tape for the merchants. Online gaming falls into the high-risk merchant category, and because of this, there are a few more Ts to cross and Is to dot.
There are a few reasons that online gaming is considered high risk. Let’s take a look at some of them:
Technology has allowed casinos to move from their brick-and-mortar establishments, right into the player’s home. The inception of the internet has made the iGaming industry boom, but it has also made the industry harder to regulate. As it is, casinos and any form of online bet placing lie in a legal grey area. Every country in the world has different laws related to online betting, and in the US alone, each state differs in its legal restrictions. This is a big reason that banks look unfavourably upon giving gaming businesses merchant accounts.
Online casinos have an excessive number of chargebacks. Players that lose large amounts or suffer from ‘bet regret’ are usually the culprits. They will phone the banks up with their tails between their legs and say that it was not their transaction. Most of the time, the banks will comply, and this is detrimental to online casinos. This is the main reason that online gaming companies are placed into the high-risk merchant category. This form of friendly fraud is rampant in online casinos, but there are ways to mitigate it.
Card-not-present payments (CNP) are the bread and butter of online gaming. The success of the company is dependent on the ability to accept credit and debit cards virtually. Without the card and the cardholder being physically present, the merchant becomes susceptible to online fraud. This is one of the contributing factors for any business being considered high-risk. This will always be the case, and is why companies need to take care to ensure the protection of their customers by offering secure payment options through their payment processors. This added security is absolutely necessary.
As an online gaming company establishes itself, these risk factors will become slightly less. Choosing a merchant account provider who understands that is imperative. A high-risk merchant account provider should be apprised of the laws and legalities surrounding your specific area, as well as be up to date on what the implications for your business may be. Merchants specialising in general high-risk industries may not be completely aware of these specific regulations, which is why it’s a good idea to choose a specialist payment processor.
Octapay are experts in the online gaming industry and are considered the authorities in the field. Who better to trust with your future? With over twelve years experience, we will ease the application process and guide you into a profitable future. As our partners, your success is our success.