Players use a wide variety of payment methods, but the most common are credit and debit cards. In order to process transactions with payment cards — as well as other popular online payment methods — online casinos and sportsbooks need a gaming merchant account.
Keep reading to discover how to open an iGaming merchant account and how LicensingAid can assist you in making it a reality.
What is an online casino merchant account?
A gaming or betting merchant account is a type of bank account that allows businesses to accept payments, usually with debit or credit cards. With the use of a merchant account, the business receives the money immediately, without waiting for the customer to pay their credit card bill.
Why Do I Need Casino Merchant processing?
Launching an online casino or sports betting platform requires constant acceptance of online payments. To ensure high speed and a variety of methods for making deposits, a gambling operator needs a merchant account. Let’s outline the specific ways casino merchant accounts benefit the iGaming business.
- ability to accept payments from credit and debit cards;
- ability to use other common payment methods;
- fast payments from all over the world around the clock;
- ability to accept different currencies;
- transaction security for both parties;
- trust of customers who are accustomed to popular payment methods.
What is an online casino payment gateway?
An online casino payment gateway is the technology that links a player’s preferred payment method with the casino’s merchant account. It facilitates electronic transactions, enabling players to deposit and withdraw funds from their casino accounts through a variety of payment options. These gateways support a wide range of methods, including bank transfers, credit card payments, and even crypto payments.
How does online gambling payment processing work?
- The player enters their bank card details
- The iGaming or online betting merchant account provider sends the account details to the card issuer (bank)
- The issuer approves or denies the transaction and sends data back to the payment portal
- The funds go from the player’s bank account to the merchant account.
This is how payment processing for online gambling works.
Casino payment processing requirements
There isn’t a one-size-fits-all set of documents and requirements for opening an online gaming merchant account. The specifics will depend on the jurisdiction where you’re setting up the account, and the process may be simpler in some regions than in others.
Here is a list of the most common online gaming merchant account requirements:
- Application forms;
- Gambling license;
- Company registration documents;
- Memorandum of articles of association or an equivalent document;
- Identity verification of the founders and shareholders of the company;
- Transaction forecast, including estimated number of transactions, average amount per transaction, and total amount;
- Information about the cardholders.
Additionally, any director, officer, shareholder and ultimate beneficiary of the company must provide the following documents:
- Original and certified copy of identity documents;
- Certified copy of a utility bill as proof of address, with full name and full address of residence (issued within the last 3 months);
- CV;
- Letter of recommendation.
How much does it cost to open a gambling merchant account?
The cost of opening a merchant account for an online casino depends on jurisdiction, type of your business, and experience. LicensingAid specialists will help you to choose the right offshore jurisdiction and calculate the final cost of opening the merchant account.
Why is a Gaming Merchant Account Considered High-Risk?
Online casinos can face a few difficulties when opening a merchant account. Why?
- Many financial institutions are reluctant to work with gambling businesses, considering them to be inherently riskier compared to other industries.
- Online casinos and sportsbooks are prone to excessive chargeback and refunds.
- There’s a common perception that gambling businesses are at a high risk of being used for money laundering, or otherwise having a connection to organized crime.
The best — if not only — way that an online casino or sportsbook can demonstrate its legitimacy is to have a license. In most cases, banks won’t open a merchant account for unlicensed casinos or sportsbooks.
How can LicensingAid help?
LicesingAid is a company offering advice and assistance for online casinos and sportsbooks in regulated markets. We help applicants prepare documentation, acquire licenses, and get high risk casino merchant accounts. We also provide financial and business advisory services. We promote the legal gambling industry by helping new enterprises acquire a license, making sure the world of regulated gambling can grow and bloom.