September 12, 2024

How to choose the suitable payment processor for your iGaming business

This year, the revenue of the iGaming industry is expected to reach $97.70bn. The number of transactions at these figures must be phenomenal. For all this to function efficiently, every iGaming platform needs a reliable payment processor. In this article, we will determine how to choose one.

What is a payment processor for iGaming?

A payment processor for iGaming is a service that handles all the financial transactions between players and online gaming platforms. It’s the behind-the-scenes system that makes sure deposits, withdrawals, and purchases happen smoothly and securely.

The processor checks if the player has enough funds, moves the money where it needs to go, and keeps an eye out for suspicious activity. It also ensures that everything complies with the various legal requirements of the gaming industry.

In essence, a payment processor keeps the financial part of online gaming running, allowing players to focus on the fun.

6 aspects to consider when selecting a payment processor for iGaming

Not every PSP is suitable for iGaming business because of its specific needs. These include, among other things, a large number of small transactions, higher fraud risk, and a complex regulatory framework that varies from country to country.

So, when looking for a payment partner for your iGaming business, consider the following:

Security and fraud prevention

The gaming industry is often associated with higher fraud risk. A reliable payment processor should offer:

Data encryption: A security process that converts sensitive information into a string of unreadable characters that can only be deciphered by authorised parties.
Tokenization: Swaps out sensitive data, like a credit card number, with a unique token representing the information. This token can’t be used to retrieve the original data, making it safer to store and process.
Advanced fraud detection: Uses AI-powered tools to monitor transactions in real time and instantly spot and block suspicious activities.

Payment methods and currency support

iGaming platforms usually attract players from different countries, each with its preferred payment methods and currencies. When selecting a payment processor, consider:

Payment methods selections: Your payment provider must support various methods, like credit/debit cards, e-wallets, bank transfers, cryptocurrencies, and other alternative payment methods. This will allow you to meet the preferences of a broad audience.
Multi-currency support: If you want to grow your business internationally, your processor should be able to process payments in various currencies and handle currency conversion smoothly. Otherwise, you and your customers will lose a lot of money on the exchanges.
Local payment options: Providing traditional card methods or PayPal is not enough, especially if you plan to work in countries like China or Brazil. Each region has its preferences, and if you hit the mark, you can improve customer satisfaction and conversion rates.

High conversion at checkout

Ensuring a high conversion rate at checkout is critical for maximising revenue. There are three main aspects to check:

User-friendly interface: Checkout design should be intuitive and straightforward. Players are more likely to complete their transactions if the payment process is easy and requires minimal steps.
Quick processing times: Speed is crucial at checkout. It minimises the risk of players abandoning their carts due to delays or slow load times.
Multiple payment options: As mentioned above, the more choices available, the more likely players are to find one that suits their needs and complete the transaction.

High uptime

High uptime ensures that your players can stay in game uninterrupted and make payments at all times. This factor is essential for customer satisfaction and revenue.

Reliability: The payment processor should provide a reliable infrastructure that minimises downtime. That way players can make deposits and withdrawals whenever they want, without disruptions.
Monitoring and support: Continuous monitoring and effective support from the payment processor can quickly address any issues that might affect uptime. This proactive approach helps maintain a stable and reliable payment environment for your players.

Regulatory compliance

One of the most critical factors in choosing a payment processor is ensuring that it complies with the regulatory requirements of the jurisdictions in which you operate. Different regions have different laws for online gambling, and your payment processor must be licensed and authorised to process payments in those areas.

Jurisdictional licences: Verify that the payment processor holds licences in the regions where your business operates.
Anti-Money Laundering (AML) and Know Your Customer (KYC) compliance: Ensure the processor has robust AML and KYC procedures to prevent fraud and money laundering.

Learn about payment regulations in Asia.

Transaction fees and costs

Understanding the cost structure of a payment processor is essential for managing your business’s profitability. Consider the following:

Transaction fees: Evaluate the fees per transaction, including setup fees, monthly fees, and hidden costs. However, when processing with Payop, you pay only for successful transactions.
Currency conversion fees: If you deal with multiple currencies, be aware of conversion fees that might affect your profits.
Chargeback fees: Given the higher risk of chargebacks in iGaming, it’s important to understand the costs associated with handling chargebacks.

Integration and user experience

Simple integration of the payment processor with your iGaming platform is crucial to running your business smoothly. Key considerations include:

Ease of integration: The provider should offer quick integration into your platform. With Payop, you can connect all selected payment methods through our reliable API or technical integrators such as Praxis or PIQ.
User interface: A payment provider should offer an intuitive interface that will be easy to use for your financial transactions and control.
Mobile compatibility: With the rise of mobile gaming, ensure the payment processor is optimised for mobile devices.

Customer support and industry experience

The quality of customer support can significantly impact your business, especially in a high-stakes industry like iGaming. Look for:

A dedicated account manager who will provide personalised support and faster resolution of problems.
Service Level Agreements (SLAs): Review the SLAs to understand the processor’s commitments to uptime, response times, and issue resolution.
Reliable partnership: Not rarely providers connect iGaming businesses without verification, and then turn them down due to regulatory requirements or other industry features they are not ready to deal with.
Industry experience: Look for processors with experience in the iGaming industry and a deep understanding of its unique challenges.

iGaming payment trends in 2024

Keeping an eye on trends can be helpful in shaping your payment strategy. So, here are our top picks of what’s hot in the iGaming payments market right now:

Cryptocurrency: The use of cryptocurrencies such as Bitcoin, Ethereum and stablecoin is growing in iGaming. This alternative to traditional payment methods offers players anonymity, fast transactions and lower fees.
Digital wallets continue to dominate the market, offering secure, convenient, and fast payment options. For iGaming platforms, they mean the ability to cater to players across different regions.
Mobile payments: With the majority of gaming happening on mobile devices, mobile payment solutions like Apple Pay, Google Pay are increasingly popular. They offer mobile gamers the ability to pay without interrupting the game.
Open banking: Another technology that provides players with quick payments. One example is Payop’s Pay by Bank solution. It allows users to make payments directly from players’ banking apps. No need to enter any data – quick and secure!

Payop – your reliable payment processor

With many years of experience in the industry, Payop deeply understands what your business needs to thrive. We’ve tuned our payment processing solutions to offer you simple integration, reliable uptime, high conversion at the checkout, attention to regulations, and advanced security features.

Plus, we support over 500 payment methods and 100 currencies, giving your players the flexibility and convenience they expect.

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