As part of the countdown to ICE, Paysafe’s Neil Erlick spoke to Totally Gaming about the changing payments landscape in the gaming industry. You can read the original online here on the Totally Gaming website.
When I’m asked whether cashless gaming is gaining ground, my answer is: ‘absolutely!’ In fact, I’d actually say it’s speeding up, due to the positive impact it has on the user experience.
It is widely reported that digital channels are increasingly being adopted in the gaming industry. Research from Juniper suggests online gambling will draw over $1 trillion in revenues by 2021, while gaming using emerging technologies such as virtual reality is expected to rise by over 800 percent in the same time frame. As gaming continues to expand and explore digital channels, new ways to pay will continue to emerge to cater to this market and facilitate a more seamless customer experience.
Paysafe’s recent Lost in Transaction research report sheds light on the changing nature of the payments ecosystem, in which consumers are increasingly using new digital payment methods to satisfy their desire for greater convenience and choice. One clear change has been the use of mobile, with 86% of consumers expecting to use their mobile wallets for payments much more in the next two years. The ease of mobile payments will no doubt continue to pave the way for new and exciting payment innovations to succeed.
A place for cash
But let’s remember, ‘cashless’ isn’t necessarily a term that should be taken too literally as it often refers to the adoption of digital forms of cash.
Traditional cash, coins and notes, continue to have a clear place in the gaming industry. They’re quick, private, and easily authenticated in the majority of cases. These benefits combined mean cash is still a relevant and convenient way to pay in gaming, but this doesn’t necessarily pose an obstacle to the rise of new forms of digital cash in the industry. Indeed, our research shows that rather than cash and digital competing with each other, the sweet spot is often how cash is merging with digital formats. This is demonstrated by the rise of alternative payment methods, including voucher based systems and digital wallets which are convenient, enable instant transfers to gamers’ accounts and access to a much larger consumer base.
However, these new payment solutions are not without their challenges. The gaming sector is highly regulated which means that the introduction and integration of these payment methods can be a fairly lengthy process, especially as regulations vary significantly across geographical borders. So, while cashless, or new forms of digital cash, may be on the rise in the gaming industry, there is still work to be done before we can consider this growth sustainable.
A cashless future?
Regulation and consumer adoption obscures the timeline on the evolution of a cashless society, but it is certain that going cashless will become more prevalent over time, which is evident in the gaming industry’s digital transformation to date. Consider the industry’s evolution over the last eighty years, particularly in gaming hotspots like Las Vegas, in which gambling was traditionally the undisputed focal point of casinos.
Today, gambling forms just one pillar of the entire casino experience, alongside entertainment, cuisine, sightseeing and social appeals. The entire gaming experience has completely transformed over time, and will continue to change in the future. The way people pay is just one element of gaming and we can expect to see both alternative payments and cash evolve in the years to come alongside the wider consumer experience.
Alternative payments at Paysafe
We design our products to cater to the needs of an increasingly cashless gaming industry. Paysafe’s digital wallets, NETELLER and Skrill, represent a gateway to the full suite of products we offer. From this point, we developed a holistic offering that is suited to the demands of gamers, such as cash conversion into e-money with paysafecard, a prepaid offering that brings the convenience of cash to transactions, representing an easy transition point between the present and future gaming landscape.
Our technology is tried and tested and the overall suite works together to cater to the current and future gaming landscape. Supplementing this, Paysafe is developing a consolidated data and analytics platform that will help it bring new products and services to market and help it maintain its competitive advantage in the future.
Paysafe is a subject matter expert in the gaming industry and helping operators optimise their offerings, whether that’s assessing risk, evaluating data or helping with ‘know your customer’ (KYC) initiatives. With over 20 years of knowledge in this industry, we are experienced at working in highly regulated markets as well as assessing and responding positively to regulatory evolution and shifting merchant requirements.
Having been fundamentally designed for gaming, the full portfolio of payments products is well-placed to continue evolving alongside the industry as it becomes more cashless. We firmly believe our expertise and commitment combined with innovative technological capability makes us a leading payment solutions partner in the industry.
Back to the future
It’s clear that a new era of payments has emerged in gaming. For gamers, this new era heralds unparalleled freedom and flexibility to pay in the manner most convenient and relevant to them. While for operators, huge opportunities for differentiation and competitive edge will present themselves to those who can adapt to the change of pace. Implementing a seamless payment offering that integrates elements of both traditional and digital methods will not only offer a heightened experience, but ultimately increase customer loyalty.
Come and see us at ICE Totally Gaming, stand N9-140