PayNearMe report indicates payments for sports betting and igaming can be improved

November 15, 2023 2:46 PM
  • Rege Behe, CDC Gaming Reports
November 15, 2023 2:46 PM
  • Rege Behe, CDC Gaming Reports
  • United States

Earlier this year, PayNearMe commissioned a report about experiences sports bettors and igaming patrons have with apps and websites. The Santa Clara, California-based developer of payment technologies sought to understand issues that customers sometimes encounter during payment experiences.

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The survey indicated that payments for sports betting and igaming aren’t as frictionless as, for example, ordering a cup of coffee or a ride service. According to research conducted by Betting Hero for PayNearMe, 22% of respondents cited user-interface or user-experience issues as obstacles to frictionless payments and 29% reported problems funding accounts or withdrawing money.

PayNearMe Vice President and General Manager of iGaming and Sports Betting Leighton Webb says the survey was spurred by a need to keep clients informed about issues customers face in sports betting and igaming and to provide solutions for those issues.

“Operators spend relatively a lot of money to acquire customers,” Webb says. “It’s important that they convert those customers, get them through the process of making a successful deposit, and in completing that journey disbursing funds as they win. That entire experience goes to a lifetime value of the customer. As in any business, you acquire customers and you maximize that lifetime value.”

According to the report, 44% of respondents said they would delete or abandon an app if it “was too glitchy or non-responsive.” And 13% who encountered a deposit issue and 26% a withdrawal issue said an app lacked a payment method they were willing to use.

Because payments for sports betting or igaming are intrinsically different than booking a flight with an airline or renting a car – “gaming has disbursement of winnings, while buying an airline ticket isn’t disbursing funds,” Webb points out – additional considerations need to be accounted for.

“Gaming is considered high-risk from the network’s perspective and e-wallets are sometimes declined for a deposit where you may not see that decline at Starbuck’s through that app,” Webb says. “So if a user is experiencing friction in that process, it’s important that you’ can communicate to them clearly as to why that might be, then redirect them to try another payment method with the goal of having success.”

The risk of a deposit experience with hassles can result in an operator’s losing potential customers. The report revealed that 23% of bettors unable to deposit funds with an app left and didn’t return. Only 21% with funding issues and 24% with withdrawal issues reached out to the app’s customer-service department for assistance.

Webb estimates that acceptance rates for sports-betting/igaming deposits are approximately 90%. Some of the issues encountered by the 23% of bettors unable to deposit funds included insufficient available funds or too many rapid deposits in a row that triggered a velocity limit.

Operators also use risk and fraud tools that are “dynamic,” according to Webb.

“You don’t want to make it too restrictive. Then you won’t to get people through,” Webb says. “But you don’t want to make it too permissive, because then you’ll  introduce fraud. So you can see a variance between the operators in terms of what that acceptance rate is.”

That results in a wide range of acceptance rates, depending on how each operator refines the payment experience, starting with “the design of the cashier, the availability of tenders, and how they’ve implemented fraud tools,” Webb says.

That’s why it’s important for operators to make multiple tender types available to customers. And it’s better for operators to be upfront and let customers know that if certain payment options are unavailable, other payment options can be accessed.

For operators, PayNearMe, through its MoneyLine platform, offers customizable, flexible, end-to-end payment solutions for specific needs. The company’s products, including risk-and-fraud and back-office tools and data insights add value and ease to payment processing.

“We bring all of that together in one ecosystem,” Webb says. “And that’s really hard to do for operators. The data piece, whether it’s risk-fraud or data insights, is extremely important. If you don’t have that, if you don’t understand what’s going on within your overall payments experience, you can’t measure and improve it. We provide that insight, that ability, and the capabilities to make those improvements, so the operator can continually refine and optimize payments.”

The report, conducted by Betting Hero for PayNearMe, surveyed 231 bettors over the age of 21 from Ohio, Massachusetts, Maryland, and Ohio.