September 27, 2022 iGaming, Payments

US igaming payouts: the need for urgency

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Umberto Corridori tells Gaming America how instant payouts can win and retain new players in the iGaming market.

As the US iGaming market expands, the opportunities for operators to accelerate revenue growth will be seismic. Research predicts we will see a compound annual growth rate (CAGR) of more than 10% between 2022 and 2030 as the industry matures, more states come online and the player base increases in states that have already regulated.

Market leaders and international operators are eyeing up the US market, and disruptive start-ups will squabble for market share in an increasingly saturated market. This will push player cost per acquisition (CPA) up via increased marketing spend and sign-up incentives, and potentially lifetime value (LTV) down as fickle players switch between multiple options.

Player experience is crucial for operators wanting to successfully navigate this challenge, and this begins with the cashier. The range of payment methods, a seamless authentication process, smart deposit sum suggestions, and likelihood of payment acceptance are some of the ways deposits can have an impact on overall player experience.

The importance of payouts can be overlooked because a clunky or failing experience doesn’t have the same immediate effect on player acquisition as factors such as acceptance rates. However, this could be a critical mistake. As our recent whitepaper on the impact of real-time payments on the US iGaming industry explains, offering a seamless payout experience is the key criterion on which players judge operators.

Instant payouts: a game changer for player experience

Players with a bank account integrated into Nuvei’s Clearing House’s Real Time Payments (RTP) can request an instant payout via Nuvei Instant Bank Transfer. Now operators can integrate instant payouts to cards as well.

There are several reasons why integrating instant payouts to cards can have a significant impact on player experience:

Fast payouts are players’ top priority 

Industry research says quick and secure access of funds is the most important consideration for iGaming players. Demonstrating frictionless cashing out is a critical tool for player acquisition. Also, fast payouts allow iGaming merchants to explore new marketing activities to engage with existing players.  

The value choice TO consumers

Factors including convenience of bi-directional payment flows, security concerns, availability, willingness to embrace new technology, and the likelihood of acceptance mean that consumers have developed strong personal preferences when it comes to payment methods across eCommerce. The extent of checkout options is a determining factor in whether a consumer chooses to complete a transaction with a merchant. For iGaming operators competing for players in a saturated market, failing to convert players due to limited deposit or payout options could have a dramatic impact on CPA and also damage LTV.

Physical cards are still preferred

Despite the emerging popularity of alternative payment methods, cards remain the most commonly used online payment method in the US. Research says 56% of US consumers use credit cards to make online purchases on a monthly basis and 49% use debit cards. 

Next up at 38% is digital wallets, while only 9% of online purchases are made via online bank transfers. Almost two-thirds of US consumers say their preferred online payment method is a physical card.

The US online payment landscape is different due to issues with card acceptance rates and players’ reluctance to share financial details with operators. There has been less reliance on card payments, with alternatives such as instant bank transfers being popular. But card acceptance rates have improved dramatically as banks and issuers have become more comfortable with regulated iGaming, making card payments increasingly important for players that prefer to use cards for their online payments.

What’s next for instant payout – card integration? 

Marketing leading payments providers know the importance of instant payouts to cards and are working with card schemes to make this a reality for operators. Push payment platforms such as Visa Direct and Mastercard Send enable operators to send funds directly to their customers’ cards. 

The impact of Nuvei Instant Bank Transfer’s RTP capability has been dramatic for iGaming operators in North America. Instant payouts to cards is an effective tool for maximizing operator revenues and accelerating business growth; it must be strongly considered across the industry.

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