Ensuring the smoothest payment journey whilst retaining security is a challenge that operators have long sought to remedy. However, with new and evolving tech, as well as lessons from ecommerce, a frictionless payment journey is closer to being a reality.
In the latest edition of the Payment Expert Innovation series, we spoke to Rahul Das, Director of Payments at LiveScore Group, as he prepares to speak at the SBC Summit Barcelona.
Payment Expert: Firstly, Rahul can you tell us what are some of the key challenges to ensuring a smooth user experience when it comes to the payment journey in betting?
Rahul Das: It’s best to break the problem down: what payment methods should you offer (what’s best for the merchant isn’t always what’s best for the user)? Can you make the journey easier (for example, using 3DS exemptions for card transactions, or reference transactions with PayPal)? Is the customer journey what the user expects (for example, Dutch customers are fine with authenticating bank payments with their mobile apps)?
Getting the balance right between these sometimes contradictory requirements are the key challenges that one normally faces. Further complicating matters are considerations stemming from fraud, AML requirements such as Closed Loop, Card Scheme rules etc. Creating a simple user journey is a complex problem.
PE: At SBC Summit Barcelona, you will be discussing the gambling industry’s progression towards emulating the smoothest ecommerce experience. How close do you believe the industry is to achieving this level of seamlessness in user experience?
RD: Lumping the whole industry together would be a mistake. In general, companies in our industry live and die by the user experience, and with so many substitute entertainment options, our success depends on getting it right reliably.
The industry is on a continuum when it comes to seamlessness. Some companies do it better than others, with success requiring a commitment to testing, tweaking and developing/adapting to best practices. Outsourcing a cashier can be better than a poorly designed/maintained customer journey. But being able to deliver a fully optimised journey in-house will consistently deliver business value.
In general, I’d say we’re better than a lot of other industries – especially in hyper-competitive markets such as the UK – as we are generally a digital-native industry with highly-substitutable products. We have to be slick to survive!
PE: What lessons do you believe that gambling can learn from ecommerce when it comes to the user experience?
RD: There are definite areas where we can learn from ecommerce – Amazon’s 1-Click was a game changer for eCommerce, and still an ideal where possible. Seamless checkout with PayPal is another innovation that we’ve borrowed from other industries.
Fintechs, in particular, are doing some very clever things around selfie videos and slick registration journeys. There’s a lot of value in what they’re up to – other than the obvious which is developing new designs and workflows – they’re also “training” users to expect these new technologies and approaches to verification, which lowers the user’s resistance to utilising them on our betting sites.
PE: Generally speaking, do you believe it can be simple to integrate the lessons and principles of the ecommerce payments journey into gambling?
RD: I wouldn’t say it’s simple: with a lot of betting companies, the technology platforms are generally brought in to various degrees. This means that to deploy new technologies, you need to convince the suppliers to adopt the new technologies – which they are often loath to do.
If you own your own technology stacks, getting experimental technology implemented can be an ordeal in itself. This is where some new innovative verification suppliers can, and are, changing the game by allowing merchants to completely outsource their registration and verification journeys.
PE: Will principles from the ecommerce payment journey play a role in enhancing the way operators engage with casual bettors?
RD: If merchants are clever, yes they should mimic best practices from eCommerce. Will they be able to effectively? That comes down to how much control of their technology stack they have, and how motivated they are to do better for their users.
Either way, there are standard ecommerce best practices that should be adopted when it comes to aspects like passwords/forgotten password journeys, payment authentication/fraud management, fast checkout and payment options etc. A lot comes down to usability and design – and not being a UX expert, I can’t speak the language of ‘burger menus’!
PE: How significant are regulations as a hindrance when it comes to providing a seamless payment journey for operators?
RD: I’m not convinced that regulations are a hindrance anymore. PSD2, and in particular SCA, was looking to be a disaster for the industry, but I think it has actually been really good for regulated betting merchants.
As an industry, we generally have lower fraud rates, and PSD2 means that our ‘clean’ payments volumes are actually desirable for payment processors as it lowers the risk level of their books which translates into better pricing. With our fraud rates allowing us to tap into the highest exemption levels, we can also maximise the SCA frameworks to actually deliver slick customer experiences.
PE: What role do you believe Open Banking can play in ensuring security and boosting efficiency in the user experience?
RD: Open Banking holds great promise, but it still is immature. In the UK, standard OB APIs don’t provide date of birth information, for example, which means that using OB data for KYC purposes is not possible (unlike in Scandinavia). Some providers are emerging that utilise premium APIs to get that information, but it remains niche.
The other hindrance is that while the Open Banking authentication process for payments is comparable to the challenge flow for card payments under PSD2/SCA, most card transactions don’t get challenged today. That means that using Open Banking is more of a nuisance for customers than paying by card. Again, variable recurring payments (VRPs) can simplify things, but they’re not mainstream yet.
So, Open Banking does hold great promise, and it’s materialising, but we are still a long way from calling it ‘efficient’ from a user perspective.
Looking ahead to the SBC Summit Barcelona, the Payment Innovation series places a closer analysis on some of the industry’s key technologies and developments.
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