As the world starts to recover from COVID-19 and global economies begin to reopen, a clearer picture of what the new normal for betting shops looks like is emerging.
We spoke to Trustly’s Director of Gaming Sam Barrett, who explained how he believes transactions will take place in betting retail outlets following the pandemic, as well as what challenges this could lead to in terms of consumer engagement.
Firstly, can you tell us what some of the key benefits would be to making retail betting shops contactless?
It’s important to distinguish between what is meant by ‘contactless’ and what is meant when we say ‘cashless’. Because we’re in the midst of a global pandemic, the term ‘contactless’ has obvious connotations when it comes to the brick and mortar retail environment. But, in my mind, ‘contactless’ precedes the current situation as it’s been around as long as NFC technology has. Technically, a contactless payment is when you can tap your card onto a device.
This even applies to mobile payment methods like Apple Pay, because it’s still linked to a card. ‘Contactless’ is a part ‘cashless’, which is a bigger, more overarching thing that opens up avenues for so much more new, exciting things in payments. For example, a ‘cashless’ payment could also allow you to transact seamlessly and directly through your online bank. Without the need for cash, cards or apps.
Now, when it comes to minimising cash in the retail betting space and making things more digital, operators have long understood the benefits to be gained. When cashless payments are embedded within a retail business, it’s safer for players who don’t need to carry cash on them. It’s also more operationally efficient and cost-saving for operators who don’t need to physically handle large sums. Digitising the retail space in general means that things become more data-driven, which in turn helps operators improve the overall experience for players. But, how do you digitise the traditionally cash-orientated retail space? Well, payments is a very good place to start.
Does the demographic of betting shops make them less likely to embrace contactless payments?
No, I wouldn’t think so. I wouldn’t say that a cashless environment is necessarily catered towards the younger and (probably) more tech-savvy individual. It’s catered towards those with mobile phones and online bank accounts. And as we know, most people today have those things. It’s not like new tech is being placed within an old environment. Existing tech is being placed in a newer environment where the player profile ranges from young to old. So, there shouldn’t be any concern for operators about losing a potential customer just because their business has gone more digital.
Have you seen a shift in habits of betting shop customers, to become more accepting of contactless payments?
As payments experts, we can say that more and more people want faster, easier ways to enjoy the experience. And where this is proven is in the speed and convenience with which a player receives their winnings. With card payments, withdrawals tend to take a few days to settle. Whereas with cash, there’s a sense of instant gratification.
So taking that into account, people will be more accepting of digital payment methods that let them make instant payments directly from their bank account and let them withdraw instantly back into their bank account – without the need for cards or cash. That is what will change the game.
How can you combat potential AML risks involved with contactless betting in shops?
Cards could get stolen or cloned, and cash doesn’t really allow for operators to perform due diligence. By digitising betting shops, it makes it easier to track funds, who the owner is and its origin.
So, the risks are severely minimised. And, when it comes to reconciliation, taking payments digitally means that it’s far easier and more operationally efficient for the operator to receive that payment and check against the current identity of that player who’s made it. It also gives them the opportunity to check individual affordability and the source of the funds to ensure that they are, from a behavioural perspective, in a position to gamble within their means. This lets operators not only beef up their AML efforts but also be more responsible.
What type of regulatory obstacles are involved with retail contactless betting?
There are less regulatory obstacles the more things are digitised. Regulators increasingly want retail operators to be more responsible. They want operators checking ongoing affordability, checking the source of funds, restricting players with gambling addictions, etc.
Up until now, retail operators have found it tough to keep up with these demands without the right digital tools. By introducing more digital payments into the retail environment, this gives operators the opportunity to offer the same tools and benefits that online sites offer players today. And we know that players appreciate tools that help them to play more responsibly. As digital payment providers, we can make it possible for players to set their own daily limits, giving them the platform to monitor their own behaviour.
Also, digital payment providers can help the operator monitor the behaviour of a player through deposit amounts, giving the operator the opportunity to put the appropriate restrictions in place when needed. Ultimately, digitising the payments infrastructure will give operators more visibility over players to help them measure and manage regulatory demands being set. Thus, helping them navigate regulatory obstacles more easily.
The new payment environment for betting shops will be explored further at the upcoming CasinoBeats Digital Summit, which brings together thought leaders from the gaming, betting and payments space.
To find out more about the event and book tickets, click on the banner below.