As another year reaches its final months, the payment sector has once again undergone rapid innovation and expansion, and this applies directly to the iGaming and betting landscape within the US.
A plethora of US states opened their doors to online sportsbooks for the first time, with New York the most notable, making it vital for players to be served with their preferred payment methods to optimise the user experience.
This has been one of the challenges payment providers like Paysafe have and successfully helped navigate, as Payment Expert spoke to its President of Global Gaming – Zak Cutler – as he reflected on 2022 as it winds down.
Payment Expert: Firstly Zak, could you identify some of the most important developments that arose this year contributing to the development of iGaming/betting payments?
Zak Cutler: 2022 has been a banner year for the expansion of the North American online sports-betting market – directly impacting how players pay and their transactional expectations.
Major new US state markets like New York, with its 20m population, as well as Louisiana, Arkansas, and Kansas, all went live with mobile sports wagering this year.
In Canada – the most populated province, Ontario – launched a sports-betting market for private operators in April. Ontario is expected to generate a gross annual revenue north of C$1.8bn by 2026, rivalling major US markets.
This expansion has been accompanied by the growth of existing markets. In 2022 we’ve seen international operators enter the US iGaming space. In the fall, Australia’s ASX-listed BlueBet launched its ClutchBet brand in Iowa, with plans to expand into other states.
Off the back of this growth, iGaming has continued its transformation into mainstream entertainment for North American consumers. In the US, this has been accompanied by the ongoing improvement of card acceptance rates, but it’s also seen even stronger player demand for faster deposit and payout times across a broader spectrum of payment methods.
PE: What have been some key areas of growth for Paysafe this year when it comes to enhancing the user experience for bettors?
ZC: iGaming’s shift into the mainstream means it’s never been more important to support operators with all players’ preferred payment methods not just card payments, but also alternative payment methods (APMs) like digital wallets and online cash, or eCash, for players who prefer cash in their everyday lives.
Through our API, operators can seamlessly integrate all the payment methods their players would ever want for wagering – from our Skrill USA digital wallet and Paysafecash eCash solution, to third-party APMs.
We’ve also responded to increased player demand for faster deposits and payouts with our upgraded Skrill USA wallet, supporting instant deposits direct from players’ bank accounts as well as the ability to cash-out at unprecedented speed.
We further enhanced the wallet with the launch of the Skrill VIP player program for high-stakes bettors.
Our research shows that digital wallets are US players’ favourite APM, and VIPs actually prefer a wallet over all other payment methods. To better serve operators and their coveted VIP player base, the Skrill VIP program supports some of the industry’s highest limits for deposits and, unlike a traditional bank wire transfer, deposits can be actioned 24/7, including on weekends.
PE: What have been some of the key trends in the industry that will play even more significant roles in 2023?
ZC: Broadly, the expansion of the market at the US state and Canadian provincial level will remain vitally important. There are several new US markets on the horizon, with Maryland set to launch soon after Thanksgiving, and Ohio slated to go live January 1st.
These and other new markets will almost certainly serve to galvanise other states and provinces to consider regulation.
At a payments level, supporting faster payouts will remain a key industry focus. Our research reveals that US players prioritise cashing-out quickly over all other considerations – including odds, sports markets, and bonuses – when selecting a sportsbook brand.
Given the player acquisition and retention value of payouts, a seamless experience cashing-out needs to become the industry norm.
In terms of payments supporting customer conversion for specific player segments, high-stakes players will also remain key, as the North American iGaming frontier continues its expansion in 2023. It’s essential that the payment experience for VIPs is bespoke and streamlined across their favourite payment methods, especially digital wallets.
Finally, the importance of operators providing players with true payment choices at their cashier will be paramount. In 2023, we expect to further strengthen our platform by complementing our own payments solutions with several popular third-party APMs.
PE: With Super Bowl LVII expected to be one of the biggest dates on the calendar next year for operators, what has Paysafe learned from last year’s Super Bowl in terms of managing traffic and usage?
ZC: For this year’s Super Bowl, we saw unprecedented payment volumes and traffic, as our payment platform and systems were robust enough to support the demand.
With several new states, plus Ontario going live since February, along with iGaming’s growth in existing markets, we expect payment volumes to be even higher for Super Bowl LVII, and we’re preparing accordingly.
America’s biggest sports event also tends to attract high wagers and VIP sports bettors in particular. We rolled-out our Skrill VIP player program for high-stakes bettors in time for this year’s Super Bowl, helping our operator partners better serve this important customer segment.
For Super Bowl LVII on February 12th, we expect our Skrill VIP program to continue tailoring a unique wagering experience for operators’ VIPs, with bespoke deposit limits.