Online payment technology has redefined the way people go about their daily lives. Moreover, in its evolution, it has also acted as a tool that fueled the expansions of entire business sectors. The online gambling sphere is a prime example of an industry whose growth fintech did not only power, but its existence was essential for this sector’s formation. According to Kristian Gjerding, the CEO of Cell Point Digital, a leader in payment orchestration, these two have a yin-yang relationship, as – “one without the other has no value.”
In 1994, the small Caribbean nation of Antigua and Barbuda passed the Free Trade and Processing Act, which allowed the licensing of internet betting operators that could offer their services globally. However, despite this event, online casinos and sportsbooks did not become a thing until two years later. In 1996, Canadian entrepreneurs Andrew and Mark Rivkin launched the World Wide Web’s first interactive gaming site – InterCasino. They did so via WagerLogic, a subsidiary of the company they founded from their parent’s basement in 1995, CryptoLogic. That entity created the secure financial transaction system that facilitated the first gaming transaction over the internet.
Today, the online gambling industry pulls in revenues of around $60 million and is on course to double this figure in the next six years. The widespread availability of cost-effective mobile applications and soaring internet penetration should contribute most massively to this market’s growth over the forecasted period. That said, industry insiders believe new payment solutions will also have a dramatically positive effect on online betting’s unstoppable momentum.
Why Payment Processing Is Paramount in Internet Betting
Undoubtedly, the success of the online casino realm can, in large part, be attributed to the varied range of payment methods that digital wagering platforms offer. Players quickly depositing and withdrawing funds from their gambling account is essential, as most of the hassles in internet betting get linked with payment processing. That is so because most gambling websites use identical software solutions. That applies to their general interfaces and the products they have on hand, as these online slot games, for example. Thus, there is often little difference in the betting services that they offer.
Operators mainly differentiate their platforms from their competition by loading them with unique promotions and diverse transaction options. In the past, credit/debit cards were the only choices available, and they let withdrawal money transfers go through in three to five working days. That is something that most bettors saw as a nuisance. In the late 1990s, PayPal and other e-wallets appeared on the scene and cut this wait time significantly, allowing online gamblers to get their winnings in as little as 24 hours. Now, it is standard for virtually any established site to feature a vast portfolio of transaction options that suit a broad spectrum of gamblers.
Payment Methods Exclusively Developed for Online Gambling
Though PayPal was first to the party, so to speak, Neteller also got founded in 1999 in Canada. However, it did not begin processing online gambling transfers until July 2000. At that time, it facilitated 85% of money transactions at the world’s online gambling merchants. Neteller’s main advantage was that it catered to players from the US, tailoring its service to them. It no longer favors North American residents but remains a popular method for those residing in other territories, particularly in the UK. Skrill, which operates under the PaySafe Group umbrella, same as Neteller, also based its business model around gaming transfers. These two e-wallets remain viable players in both the digital payment and iGaming landscape.
More recently established payment solutions that target interactive gamblers include MuchBetter, ecoPayz, PaySafe prepaid cards, and Trustly. The latter is an intriguing company due to their Pay N Play instant gaming solution that allows gamblers to start betting at Pay N Play platforms without creating an account. The system involves player info getting sent from their online bank account to their chosen gambling operator via the electronic identifier BankID and dedicated API, a software intermediary.
Blockchain Technology Is Changing the Game
Bitcoin got invented in 2009. Two years following this occurrence, the first crypto gambling platforms appeared. These were dice sites that featured simple gaming fun. From then, it took years until interactive betting hubs that offered slots that accept cryptocurrencies showed up. In the past couple of years, these online casinos have taken over the digital sphere. However, a real game-changer could be token-based virtual gaming establishments that started popping up in 2021. These are virtual locales that exist in metaverses such as Decentraland and accept ERC-20 tokens. Atari, the video game pioneer, runs such a spot in Decentraland. It is one amongst many similar virtual casinos that lets players wager on traditional games of chance and Atari-based ones.
About the Author
Shelly Schiff has been working in the gambling industry since 2009, mainly on the digital side of things, employed by OUSC. However, over her eleven-year career, Shelly has provided content for many other top interactive gaming websites. She knows all there is to know about slots and has in-depth knowledge of the most popular table games. Her golden retriever Garry occupies most of her leisure time. Though, when she can, she loves reading Jim Thompson-like crime novels.