Over the past decade, the perception of the online gaming and gambling industry has undergone a major transformation. Traditionally viewed with suspicion and negativity, it is now increasingly better understood and more widely accepted.
In its earliest days, the industry was confined to making global payments solely through Visa or MasterCard. However, with the advent of PayPal, businesses strived to find a way to reach the largest possible audience while expending minimal effort.
Now, many enterprises in the industry are looking to grow their reach to customers outside of their established markets and optimise local payments in these regions accordingly. With changes to regulations in the US, Canada and South America opening the doors to the world of online casinos, this is a trend that will likely spread to other countries.
In tandem with the growth of online gaming and gambling, we’re seeing borderless e-commerce, cross-border business-to-consumer payments and global trade improvements contributing to a surge in cross-border transactions in the industry. As such, it’s projected that global cross-border transactions have grown in value to $39 trillion in 2022, from $29 trillion in 2019.
The trends shifting the landscape
Rapidly changing consumer preferences are a significant factor in the shifting gaming and gambling landscape too, with consumers expecting a fast and intuitive experience for payment processing.
There’s also the increasing popularity of alternative payment methods like e-wallets with online casinos frequently using services like Skrill, PayPal, and Neteller to conduct business with players. Not to mention the widespread availability of mobile banking and e-payment services through increased mobile phone ownership. In emerging economies, mobile phone ownership among the adult population has risen, which is likely a large contributor to the estimated 60% of the world’s population using digital wallets by 2026.
The growth of increasing trade with emerging markets such as Africa and Latin America is also having an impact. Some countries in these regions are working on payment innovations involving open banking technology. These developing payment infrastructures complement a growing demand for international gaming and gambling services in line with a rise in e-commerce activity. In Africa, for example, over 30% of people already engage in online gambling, mostly through mobile gaming platforms. And while sports betting is the dominant form of online gambling, iGaming is rapidly gaining traction.
The disconnection of global networks
To remain competitive in the global marketplace, businesses in the gaming and gambling industry are looking for ways to make payments more swift, secure and transparent. Consequently, payment providers are adopting digital innovations to transform and accelerate the cross-border payments experience.
This has resulted in the emergence of a new international payment landscape in the gaming and gambling industry, one where businesses can use international payments far more effectively than before. From the perspective of companies based in Europe, where disposable income is expected to fall due to the current economic climate, unless enterprises start assessing how they internationalise more effectively to regions that are not struggling, business is going to decline. Here, survival and growth are dependent on executing better sales campaigns in different geographical regions of the globe.
By diversifying away from declining markets, businesses can effectively expand into new regions such as Latin America, North America, Sub-Saharan Africa, or Australasia where they previously had no or limited presence. This strategy not only ensures the survival of the business but also has a positive impact on the local economy as it helps to protect jobs and generate tax revenue.
Global cross-border transactions have been projected to have grown in value to $39 trillion in 2022, from $29 trillion in 2019.
A centralised network
At Ilixium, we understand the challenges faced by the gaming and gambling industry, from regulation, compliance, security, cross-border transactions, payment options, and currencies, to the sudden changes that can occur due to geopolitical disruptions or changes in government.
Having worked out how we can transact with customers in different regions around the world, using regional banks and embassies, including Latin America, Canada, Australasia or other parts of the world – we’ve effectively established our own centralised network specifically catering to the online gaming and gambling industry.
Providing payments for online gaming and gambling requires navigating the differing regulations across municipalities. We have a focus on developing deep expertise in a few countries instead of trying to be experts everywhere. As such, our global payment service and network enable gambling merchants to offer competitively priced local payment services without the requirement of having a physical presence in those markets.
Powered by our proprietary technology and deep local market and industry knowledge, we offer the gaming and gambling industry a payments platform that never goes down. It allows merchants to provide their customers with the most appropriate local payment method available in their respective countries, ensuring accurate and prompt transactions.
The outcome is that players in the gaming and gambling industry can tap into customers in new, burgeoning or rapidly expanding markets. This is not just limited to the terms of the technical connection itself, but also helps in overcoming the complexity surrounding regulations currency collection and foreign exchange – opening a new chapter in cross-border payments.