With the start of every football season, a wave of new customers sign up for sportsbooks for the first time. A huge part of that process is establishing a means of payment. This sticking point can often be a point of friction, but thanks to payment processors like Paysafe, that process is becoming smoother with each season of regulated sports betting in the US.
President of Global Gaming at Paysafe Zak Cutler took some to discuss what goes into preparing for NFL Week 1 and what to expect from the company for the rest of the season.
SBC Americas: Firstly, are you able to share more details how Paysafe prepared for the new NFL season and how you plan to support operators during this campaign?
Zak Cutler: Each year’s NFL kickoff marks the unofficial start of the U.S. sports-betting year, and our payments product roadmaps are closely aligned with this timeframe. For the 2021 NFL season, we unveiled a major revamp of our Skrill USA digital wallet to support instant funding of deposits as well as payouts.
The Skrill upgrade continued with the roll-out of a VIP player program last spring, with some of the industry’s highest instant deposit limits for American high-stakes sports bettors.
For the 2022 NFL season, we’ll be unveiling additional upgrades to our Skrill USA wallet as well as our unified payments platform. We’ll be sharing more details soon.
SBCA: The rapid-fire nature of the NFL and its fans on a matchday means that payment journey need to be efficient as well as secure?
ZC: It’s essential that sportsbooks and payment providers like Paysafe prioritize the security of transactions, which has always been top of mind for players. Broadly, the battle for sports bettors’ confidence in the security of their transactions is being won.
Back in 2018, our research revealed that only 37% of U.S. players felt that placing a deposit with an online sportsbook was as secure as making an in-person wager, but by last year, this had risen to 65% of sports bettors.
As the industry works to further increase players’ confidence in transactional security, we also need to constantly focus on reducing friction in the payments experience – across both deposits and payouts. In fact, quick and easy payouts are the top factor for U.S. players when choosing an online sportsbook, according to our research.
We upgraded our Skrill digital wallet last fall, with players now able to link their bank accounts to their wallet account, so they can make a deposit with an online sportsbook in seconds. The ethos of creating a truly frictionless payment journey needs to remain a key goal for the U.S. iGaming industry. After all, there is no play without pay.
PE: What steps can Paysafe take to adjust the payment journey for different levels of sports bettors on gameday?
ZC: Like all U.S. consumers, different sports bettors have different payment preferences. Credit and debit cards dominate wagering preferences, but digital wallets are the most popular alternative payment method (APM) for sports betting, and high-stakes players actually prefer wallets to cards. Then there are sports bettors who favor cash in their offline lives so they prefer eCash when wagering online.
A recent example of Paysafe tailoring the payments journey to different player profiles is our Skrill USA VIP player program. Given that digital wallets are the top payment method for American high-stakes sports bettors, the program allows operators to increase the deposit limits for their VIPs.
Once KYC for each player has been completed, these high-stakes bettors can deposit significantly more in a single transaction than the standard limit, including outside business hours. It’s vital for operators and payment providers to develop bespoke payments experiences – there is no one-size-fits-all when it comes to iGaming transactions.
PE: How did Paysafe experience the payment traffic during the last Super Bowl and how will it differ from the opening week of the NFL?
ZC: We saw unprecedented payment processing volumes for Super Bowl LVI back in February, with a year-over-year increase in deposit volumes of over 65% compared to the 2021 game.
The growth was partly the result of newly regulated markets such as New York – the fourth most populated U.S. state with almost 20m residents – as well as sports betting becoming a more popular and widespread form of entertainment in existing markets.
These two factors remain even more relevant today, and we can expect the 2022 NFL season to be the biggest yet in terms of wagering and, by extension, payment volumes. As well as New York, we now have Louisiana and Arkansas, with Kansas launching its online sports-betting market for the NFL kickoff, the Massachusetts’ market set to go live before year-end followed by Ohio in the New Year. In tandem with this regulatory growth, sports betting transformation into mainstream entertainment continues apace.
PE: We know not all states have legalized online sports betting, but for those who have, could you tell us some of the boundaries differing states may have when it comes to implementing your payment technology?
ZC: Each state has its own regulatory framework for online sports betting, including payments. While states like New Jersey and Colorado, for example, allow operators’ cashiers to include credit and debit cards and APMs, other states are more restrictive. Iowa, New Hampshire, and Tennessee do not allow credit cards for wagering, while New York does permit credit cards but limits the amount a player can wager with this payment method ($2,500 a year).
When a payment method is restricted or even not permitted, it’s essential that operators balance this by placing more emphasis on other payment options, especially APMs, to ensure there isn’t friction or even lost customers at the cashier.
That said, even in states where all payment methods are permitted, operators want to cover all their bases to ensure that every player has their favorite payment method available for seamless depositing and payouts.