Blog: Online Gamblers and Digital Wallet Providers Cash In
More than 125,000 online gambling accounts were created in less than a month, according to New Jersey’s Division of Gaming Enforcement. With more than $7.4 million in initial revenues from Internet gaming operations generated in the state, it’s fair to say that consumers in New Jersey are catching on, and rolling the dice as you read this.
The online gambling industry first emerged in the mid-1990s, when the Caribbean nation of Antigua and Barbuda passed the Free Trade & Processing Act. Since then, approximately 85 countries have also ruled in favor of the industry, including the European Union, where more than 7 million consumers actively gamble online today, according to the European Commission. The U.S. now is beginning to re-engage in this market, after legislation in 2011 shut down operations for a three-year period. On Feb. 26, 2013, New Jersey Governor Chris Christie signed the bill that legalized online gambling in the state, joining the ranks of Nevada and Delaware as the only states in the country that allow Internet gambling companies to operate. Gov. Christie backed the legislation in hopes of stimulating the state’s casino industry, increasing New Jersey’s casino tax revenue and promoting economic recovery.
From a business standpoint, there are a number of factors online casino operators in New Jersey, Nevada and Delaware must take into consideration. With the rise of anytime, anywhere access to technology, today’s consumers look for the simplest, safest and fastest online experience—whether it’s shopping, banking or planning a vacation. To attract the most business, online casino operators must respond to this shift in Internet behavior by integrating innovations in geo-location, mobility and payment processing technology.
Digital wallets are one method for online casino operators to simplify the payment piece of the puzzle. These wallets make it easy for consumers to safely upload their funds directly to one platform and make payments conveniently and securely with the licensed operator of their choice, without revealing any personal financial data. For online casino operators, the use of a digital wallet provides a tailored solution to process deposits and withdrawals faster, increase conversion rates and take advantage of full chargeback protection.
Beyond safety, online gamblers also are concerned with convenience when uploading their funds to begin playing. Gamblers in Europe open an average of three online accounts with different gaming operators, and experts predict a similar trend here in the U.S. By using a digital wallet, players can take their money from one casino, transfer it to their wallets and instantly upload funds at another online operator. Players easily can manage their funds on one platform.
Tying into convenience, online gamblers also look at speed as a factor when selecting a payment option. Uploading credit card information and processing ACH bank transfers with each casino operator can be time consuming. With a digital wallet, creating an account and uploading funds takes the average consumer approximately four minutes. Though gamblers still need to sign up with each casino site, digital wallets create efficiencies in the payment portion of registration.
The online gambling industry is rapidly evolving in the U.S. With additional states considering offering regulated gambling to residents and visitors, it won’t take long for many Americans to become familiar with the industry. It’s critical to educate consumers on their options for making payments to ensure responsible gambling and develop a healthy online gambling ecosystem among operators, consumers and regulators in each state. Awareness of their payment options, and the regulation and compliance standards inherent to this new online gambling environment, enables potential gamblers to responsibly take a roll of the digital dice.
Neil Steinhardt joined the Skrill Group as CEO of Skrill USA Inc. in March 2013. In this role, he is responsible for the management and continued growth of Skrill USA. Prior to joining Skrill Neil has served as managing director for paysafecard.com USA Inc., where he established the U.S. subsidiary and leveraged the company’s European assets for North America. Follow Neil @NeilatSkrill