If they weren’t used to convenience before the pandemic, Americans – young and the not-so-young – are accustomed to it now.
They can have groceries or Korean takeout and a bottle of something to drink with it delivered to their door with a few strokes on their phone, in a minimum amount of time.
Funding a gambling account should be equally easy, industry stakeholders have bemoaned. But their lack of success in eliminating the dreaded buzzspeak of friction and pain points for years has stunted industry growth and those companies’ revenues.
PayNearMe could be on the cusp of alleviating some of that pain, and in the process providing a more frictionless entry into the gambling sector for a key digitally savvy demographic and juggernauts Google Pay and Apple Pay.
The combination of tech-reliant Millennial and Gen-Z generations (all potential gambling customers) and broader industry acceptance of the gambling industry seem to have intersected nicely for the California payments transmitter.
“If you use Apple Pay and you use Google Pay in your daily regular life, you’re going to go, ‘Oh, okay, this makes sense’,” PayNearMe Strategic Sales Executive Jeremy Enke Enke told PlayUSA. “I think there’s still some reluctance amongst even the younger generation putting a credit or debit card directly in and punching it into the computer. And, understandably, if you’re not familiar with the space.
“That’s where you look at it and it’s like, well, Apple Pay and Google Pay, all of a sudden that has this element of trust because it’s tokenized, you’re not having to punch your credit card information in it’s stored in your wallet.”
Electronic form of payment could help bettors, gambling industry
In March, PayNearMe became the first payment solutions platform to include the popular Google and Apple Pay digital wallets into the suite of pay options often used in the industry: credit card, debit, ACH, wire transfers, PayPal or other intermediaries and in-person cash deposits.
“There was a study called the Future of Money that basically found that as incomes increase, so does the likelihood of people using native wallets, which ironically enough is that the target market of sports bettors, males 23-to-34 years old,” Enke said. “Sixty-nine percent of these gamblers are males. And a lot of these Gen Z and Millennials are really starting to utilize these wallets. So we kind of saw this emerging, I would say about a year ago.
“We proactively reached out to both Apple and Google ourselves on the iGaming stuff and crazy enough, both Apple and Google are super excited to enter the gaming market.”
PayNearMe executives see their company as awaiting a “whole new generation of online players,” discovering legal gambling in their states, Enke said.
“It’s just a few short steps to get a deposit onto the site. And I think that’s what’s most intriguing with this new generation of players that we talk about is everybody just wants instant and wants easy methods,” he added.
According to Enke, PayNearMe, which lists BetMGM, TVG, PointsBet, FanDuel and William Hill among its more than 5,000 corporate clients, actively lobbied Apple and Google to begin facilitating gambling payments and withdrawals. The companies have pre-existing relationships after working together in all 50 states in multiple verticals including bill payment and lending.
“PayNearMe has deep expertise in the gaming industry and is a long-time partner of BetMGM, creating the industry’s best customer experience around cash deposits,” Maria Tomlinson, Head of Payments, BetMGM said in a press release. “We’re constantly looking for ways to improve the customer experience on BetMGM, so when PayNearMe made it possible for us to expand its frictionless payments experience across more deposit types, we knew it was the best bet for both our business and our customers.”
One key way could be easing the use of credit cards stored in Google or Apple digital wallets. Deposits made to online casinos or sportsbooks with credit cards are often refused because of the dreaded 7800 series transaction code labeling them as gambling – less so with Mastercard, Enke said. It could still happen with a card stored in a Google Pay or Apple Pay wallet, but the companies hope it will be less likely.
PayNearMe, Enke said, began handling transactions from online casinos in New Jersey in 2014 and is licensed as a payments transmitter in all 50 states, with special regulations covering them as a sports betting vendor.
How PayNearMe works
Players wishing to use PayNear to fund accounts in person currently click “cash option” in the deposit section of participating online sportsbooks, then the PayNearMe icon and take the bar code received on their phone to a local retailer with the service. The nearest PayNearMe retail partners are provided with the code. The retailer scans the code and uses the payment method provided by the customer to immediately fund the account. PayNear retailers include 7-Eleven, CVS pharmacies, Family Dollar and Casey’s.
When paying with Google Pay or Apple Pay, the customer simply clicks the corresponding icon in the same deposit area.
“You basically would click whatever deposit amount you want. You hit add money, and then you would complete the deposit with your biometrics, which is either your thumbprint or your facial ID,” Enke explained. “It’s a few short steps to get a deposit onto the site. And I think that’s what’s most intriguing with this new generation of players that we talk about is everybody just wants instant and wants easy methods.”
A so-called “Smart Link” texted from sportsbooks allows customers to fund accounts in two taps without having to access the cashier page.
A cashier at a 7-Eleven in Seminole, Fla., said she’d seen the bar code system used for car payments and rent in the past.
Withdrawing money, Enke said, is designed to be as seamless. Instead of waiting for an ACH to clear for up to three days, PayNearMe customers can be paid much quicker with the so-called “push-to-debit” feature, he said.
“So you deposit a hundred bucks in the morning on a gaming site, you win money and you want to cash out at the end of the day. Now we make it possible to where you can push that money right back to your debit card almost instantaneously,” Enke said. “Obviously, it’s got to go through whatever internal controls the sportsbook/gaming operator has with [know your customer] and everything else, but essentially we enable the user to get their money out the same day.”
According to research provided in a PayNearMe presentation, 21% of players attempting to registers with a sportsbook move on “if the deposit process is too long and complicated.”