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Welcome to another episode of iGaming Daily, where we take you on the road to Lisbon, uncovering the insights, innovations, and strategies shaping the future of gaming and betting. I'm Teterdorm Clay, payment expert editor, and today we're diving deep into the world of payments with our special Path to Lisbon series. As we gear up for the SBC Summit in Lisbon, we'll look back at one of the most talked about panels from the SBC Summit North America, the payment leaders panel. where industry heavyweights predicted the tech revolutions that would transform the payment landscape over the next five years. With the proliferation of digital payment options offering increased anonymity, convenience and choice, gaming and betting has thrived. But are we truly ready for the next wave of transformation? From decentralized currencies like Bitcoin to advanced AI and hyper automation, the future holds limitless potential. but leaders must navigate the regulatory challenges ahead. In New Jersey earlier this year, speakers from the likes of Caesars Digital, Newvey and PXP Financial offered incredible insights on what to expect. And as we prepare for Lisbon, many of those predictions remain more relevant than ever. This year at the SPC Summit, the Payment Expert Summit in conference room four. will focus on the challenges of thriving in mature, regulated markets. Industry experts from leading companies like Leo Vegas, Pinnacle, Trustly, and more will debate critical decisions from direct integration to strategic partnerships. So sit back and let's revisit the predictions of the past while preparing for what's to come at the SPC Summit in Lisbon. This is your path to Lisbon only on iGaming Daily. All right, good morning, everyone. Thank you for joining us bright and early here for day two of the SBC Summit North America. We're here to talk about payments this morning. We appreciate you taking time out of your busy mornings to join us for this session and for the track. As we get started, I do want to make sure we say thank you to our sponsor, PXP Financial. Cameron, their CEO, is on this session. And certainly, we have a star-studded lineup here for the lead-off of our. conference events today on the Payments Leaders panel. So what we're here to talk about really is what's going to happen around payments over the next few years. My name is Jonathan Michaels. I'm the principal of Michael Strategies. We're a boutique consulting firm that specializes in the gaming industry. I've spent a lot of time with a lot of the people on this panel through my time at the American Gaming Association and at Sightline Payments. So really excited to talk about where we've come from on the payment side in this space and really where we're going because there's a lot of things that we're going to talk about. innovation coming to the marketplace. But also, there's a lot of challenges that are presented just at the growth of the industry. So I'll let each of the speakers introduce themselves. But again, please be sure to ask questions throughout. We're here to have a great panel today. So to get started, I always like to ask a question that's not necessarily related to this business. What is your favorite payments innovation in the past five years? Cameron, do you want to lead us off? Yeah, please. Yeah. So Cameron from PXP Financial, happy to be here. I think if I just have to pick one, the mobile wallets, the Apple Pay is the one that I can go with. And that has changed the way that I'm paying and the consumers are paying. So I think that's one of the favorite ones that I can mention. Hey, everybody. Jonathan, thanks for having me. Matt Brzezinski with Trustly. I've been with Trustly for about four years now and I had the gaming team here at Trustly. In the past five years, I think the biggest innovation, specifically in the banking space that we love is RTP and FedNow and what it's provided for a withdrawal mechanism for our operators, their consumers. Right. Imagine having to wait five days and then condense it down just to 30 seconds until they get their withdrawal. It provides tremendous value for all of their consumers to be able to get that money directly into their account instead of having to wait those five business days over the weekend where now they can pay their bar tab with it or pay their mortgage or whatever with their winnings if they win. Thanks, Matt. Trent Striplen with Caesars. I oversee our payments and fraud teams there. And I should have sat where Matt is sitting so that I could have given that response a few seconds earlier, but from an operator's point of view, perspective, I'd have to agree with Matt. One of the longest outstanding requests that we had from customers was you let me pay instantly, you take my money right away, and you let me wager with it right away, but then you hold onto my withdrawal for several days. So with the advent of not only RTP and FedNow on the online banking side, but with OCT and push to card, push to debit. We finally been able to kind of close that loop and provide customers with the same withdrawal speeds that they see on the pay ins and the wager inside Which I think from an operator perspective helps build that trust We're not holding on to your money. You know, we're getting your you getting your winnings when you want them In quick and efficient manners using methods that you use to deposit. So I think that would be those would be my top two Can I echo that to say that's exactly what I was going to say, but let's try and vary that. So hi everybody, Warren Tristram. I'm head of gaming, lottery and eSports at Nouve. Been there for the last just over two years. Been involved in payments for 11, 12 years and in the gaming industry for the last 21 years. So, but still younger than George. Anyway, you can come back. Innovation. Matt said RTP. I think that's certainly something that I would have said if I was further up the road. But I think it's all about having, echoing what Trent said, instant access to your funds. I think that actually, if you can actually deposit and withdraw quickly, people don't want to go and have the friction, the challenge of payments. It needs to happen in the background. It needs to not be something that the consumer thinks about. to have the faith that they can actually go and deposit quickly, but also withdraw quickly. So just to go and emphasize the instantaneous withdrawals with regards to MasterCard, SEND, VisaDirect, those complicated with RTP, I think, help build consumer loyalty, confidence. And so I think those three products together have really underpinned innovation within gaming certainly in the last five years. George Connors with Every. It's ironic sitting on this panel now because when I left my former position, I was all in gaming, all in iGaming, all in sports betting. And then I came over to Everie and next thing you know, I'm in sport. But and we'll talk a little bit about that and sport being more in the digital side. So to the major leagues, the college leagues. But if I had to talk about a product that I've really embraced and then watched grow, And anybody that has been in the gaming space, I've been going 30 years now, that the product would be check cashing. So check cashing was dying 30 years ago and then 20 years ago and then 10 years ago. And it still hasn't died. So I think that what I've enjoyed watching is not only the adoption of, you know, the products into the industry, I've enjoyed watching now that the car brands and the issuers are. finally doing what they needed to do all along. So acceptance is way up. But I think that the ACH warranty side or the ACH side of the check, which was a dinosaur that was going to die, I love the fact that it's still alive and flourishing. And, you know, I think I'll be dead and they'll still be talking about it going away. I'm going to go away before check cashing will for sure. And for some of the younger generation in the audience, a check is a paper form you could write on it. George probably still uses that at the grocery store, though. But the interesting point that was made here, though, around consumers wanting instant access to their payments, there were studies done by the American Gaming Association and Pay Near Me that said that fast withdrawals is the number one reason that a consumer chooses a sports book. So payments is really the front porch of sports betting. So you enroll in an account. And then immediately you go into the payments flow and Trent's managed this for years in his variety of roles of what's in there, how do you do it? But at the end of the day, customers want their money to get in quickly and they want their money to get out quickly. But certainly this landscape has evolved over the past six years since the PASPA decision in May of 2018. So what are some of the things that have caused that to change? So high acceptance, some of the... trends that we see there. So Matt, can you touch a little bit on what you've seen change over the past few years within this space to allow for the environment that we're in today around payments? Yeah, I think one of the biggest things is the necessity for innovation in the space. There's a lot of companies out there trying to enter the space and it breeds a necessity for innovation. So trust me, we've done the FedNow integration as well. So now we have even more banks for our TV available. But outside that... There are other products that we have coming to market like Trustly ID. We've heard a lot from our customers that there's a lot of time between when the consumer logs in and creates an account, and then they go through KYC, the long strenuous process, and all of a sudden they don't make a deposit. So how do you create that funnel to make it a lot tighter and a lot easier for that to happen so they can start wagering right away? So I think that competition is really driving companies to create these types of products. They really make it easier for them to get more deposits and start wagering. And that product thing is coming up really soon here. And I think you'll see more and more of those types of innovations coming out here shortly. Yeah, I would echo what Matt said. It's interesting. We were having a conversation yesterday. the percentage of customers that go through the process to provide the operator with their name, their data birth, their address, their social security number, highly sensitive information to create an account that is required from a regulatory and a fraud perspective to then go on and not fund the account. And there's a variety of reasons why they may or may not fund the account at that time. Could be the payment options, it could be that they wanted to see what offers were available, could be that they wanted to review some of the markets. But I think if we're able to capture some of that drop off, it not only helps businesses from a commercial and a revenue standpoint, but it's a better customer. It presents a potential better customer experience where it's more seamless. They're not having to go through all these hurdles. KYC and payments are the two biggest hurdles that we face in the industry today. And that's where you see the biggest drop off. So I think as Matt was alluding to, some of the innovation that we're starting to see is how do we combine those into a single step? How do you, I don't want to, you know, I don't want to reveal the, you know, the big reveal, but, you know, how do you take your online banking credentials? And just sign in with that, that creates a user account and KYC's you and does that all in kind of, you know, two or three seconds instead of multiple pages and multiple entries and maybe you don't get KYC and then you have to go through a manual process. So I think easing the customer journey is absolutely something that's on, you know, next couple of years innovation wise. So one other area that I know has changed a lot is the way the banks view this space. So, George, could you touch on how you've seen banks evolve and how they've accepted this category when it just went from essentially New Jersey trying this online gaming experiment from 2013 to 2018 to this industry is more than $10 billion in revenue on the digital side and can use to grow. So talk a little bit about the banking sector and what's changed there among their view of this category. So... 13, 14, when iGaming hit this shore legally. I was in a great spot. Now, we won't call it check cashing because apparently Trent doesn't know what checks are, but we'll call it ACH warranty. At that point, that was such a hot product because the banks, nobody wanted to touch anything to do with the transaction. They didn't want to approve. They didn't want to process. They didn't want the brand or their bank brand associated with it. So. You know, what I've seen over the last, you know, 10, 11, 12 years is the banks finally understanding that I think yesterday I was on, I was listening on a panel and they were talking about fraud and they were talking about, you know, the exposure, you know, in gaming compared to, you know, me taking Warren's credit card and going to Nordstrom's. I could run that card up, but you bring that card online. I am going to be checked. I'm not getting through easily. If I want a brick and mortar, I'm not getting through easily. So I think what I've seen is the banks finally understanding this is an overly regulated market. I mean, very safe market. People are going to gain whether they want to participate or not. And I think what we've seen is the evolution of the bank and the banks and the brands understanding that they need to be part of it or they're going to be left behind. So when this whole thing started a few years ago. Most of the top 10 banks in the United States wouldn't accept gaming transactions. Their merchant category code or MCC 7801. Now, what's interesting is Capital One is the only one that still doesn't accept that. I could see Capital One's headquarters from my house. It taunts me every day. You know, one other thing that's even more ironic than that is when a company, so I worked for FIS, right? They acquisition and bought a company I was at. FIS owned a debit network. They had a gaming company they were making a bunch of revenue in, but their debit network wouldn't touch gaming, which was more than ironic. Now they're all on board. So yeah, I was going to I was going to say the same thing. In the early days, we banked with Wells Fargo and we get on these quarterly business reviews or monthly calls with them. And we talked about card acceptance because card acceptance was, you know, 20, 30 percent, 40 percent, maybe most. And we talked to them about, hey, we have all this. We have all our funds with you. We do all of our merchant banking with you. But your customers can't use their cards on our site. And it's just it's been interesting to see how that's just completely flipped now. So and certainly we we've seen that evolution over the past few years. And a lot of those issues that we talked about around card acceptance kept probably every single person on this panel up at night. And innovation, a lot of times comes out of those challenges. So what keeps you up at night now, Trent? Well, I've got an eight month old there right now. So he keeps me up mostly at night. But from a from a from a payments perspective, I think it's the fraud side of things. And you know, in the early days, it was acquire customers, acquire customers, acquire customers, get as many people as you came through the door, worry about the fraud later. And you know, now I think it's really how do we how do we make sure that our site is secure, our customers are secure? and that we're preventing, trying to identify and prevent that fraud earlier on. You know, you see we just saw Pennsylvania this week that, you know, make they're going to make a world change to disallow credit. So I think it'll be interesting to watch and see from that perspective, from a consumer protection or fraud perspective, if that continues to, you know, to progress across other states. Just to jump on the back of that, I know that. One of the biggest challenges is fraud. I think it's like 308 billion was down to fraud which happened, which was a false positive fraud. So which shouldn't have happened. So I think that's one of the biggest challenges I think that the industry online experiences for the key leavers, which I've said on previous shows or exhibitions is down to conversion, acceptance, fraud and costs. That's what the merchant can go and control. One of the big challenges at the moment, as you say, is fraud. And that's now to fraud circuits, rings. And so it's been able to get a handle to control them on that. Cause you want to try and stop that, but you want to try and stop the false positives. And so I think that there's lots of the fraud control systems are preventing that. And as I say, 308 billion was a number which was reported last year, which was down to false positives. So how do you try and get that through with keeping the false at bay? I think that's the key challenge, which would keep any operator up at night. And certainly from a payments perspective that knew they, how can we try and assist the operators, given the intelligence to try and work around that? Well, they'll be working with other third party solutions as well. So certainly one of the other interesting things. So you always have this relationship and you both alluded to it of, we want to get people in, we want to get money in the ecosystem, but we want to make sure we protect the consumer. And certainly one of the things that's challenging in this category around payments, and I'd love to hear the suppliers on the panel and their perspective is the high cost of. So certainly gaming has been historically a high risk merchant category. As a result of that, costs are higher than a lot of other e-commerce businesses. And you also have this whole churn element that you really don't have in other things. So when you put money on your target red card, you're gonna spend that money on target. When you put your money into the Caesar sports book account, you're gonna play, you're gonna win, you're gonna withdraw, you're gonna redeposit, you're gonna lose, you're gonna deposit again, and the money just keeps cycling through. So... Talk a little about how some of the solutions that are out there could ultimately help lower the overall cost of payments. Matt, do you want to start? Yeah, absolutely. So ACH inherently is a way more cost effective option than the credit network and other types of payment methods. But I think it's also important when you take a look at ACH, you're at risk as an operator for absorbing a lot of losses. There's so many things that a consumer can do to play shell games after a transaction has been approved or to simply say that, you know, that that bet that they lost was not them and it was a fraud attack. So I think it's important when you're looking at how to keep your costs low. Something that is extremely important is fraud prevention and maybe having an option where it's a full warranty solution where you're being protected fully by your payment method that, hey, if there's ever a loss that can come back, you're protected. And I think that the full warranty type solution helps drive down cost. from your net returns as well. Because you never want to be on the hook in dealing with that consumer and having a poor consumer experience where they're out of funds and they're mad about it and they're complaining to you. And with Trustly, we offer a full guarantee as well. So we really do a great job of protecting our merchants of those types of losses. But at the same time, we do it at a lower cost because we operate on the ACH network. So I think how your question was, you know, how can you actually try and improve working with the customers or the operators can to get that loyalty as well? Were you leaning towards that? Loyalty, cost, ways to make Trent's life easier. Okay, so I think the research that we've seen from Accenture, I think digital platforms, card issuing, I think there was about half a billion cards were issued last year. We expect that to be 1.3 billion, according to the research. in 2027. So I think being able to actually, I can see operators moving into card issuing a lot more, something that Nuve has a capability of doing, I hasten to add. And with that, they will be able to go and build that loyalty, that brand resonance with them as well. So, and that helps to understand who your customer is. So you commit against those four challenges that Matt was referencing. So I think card issuing is going to be something on the landscape, which is going to be happening more and more. And I think that will go and help mitigate that challenge. Just to add a little bit, you know, from our perspective, I think data is important. And the whole process of getting the transaction through and having a high success rate is where you can optimize your market money that you spend in order to get the customer in and having the right data inside and providing the operators with the right information and right reporting will help them to optimize the success rate. So that's where we are. spend some of our energy, right? And I see that that's getting more and more important, understanding the customers and then adapting to that. And obviously we talked about, you know, instant payouts and having that fast payout process. What the friction is, is the fraud and identifying the, you know, the right fraudsters and then not paying that out so that the whole process gets faster and gets through. I think that's where the fraud tools and the new technologies will be able to help and identify the right ones. Yeah, I think going back to you asked about cost, right? So the tiger has been let out of the cage. And this is what I mean by that in the brick and mortar world, you know, the seizures of the world, they're not absorbing cost. And so right now what's happened inside the Ecom world or the online world. because it started with such desperation to get anything in payment across the line, that the sites picked up the cost. And so now everybody's been trained that the sites pick up the cost, the consumer, you know, the client will never pay that cost. And because of that, what's happened is it's all cost to them. And then what they have to do is just beat the hound out of the ones providing the product. to drive that cost down. So, you know, until there is a solution to the absorption, whether it's warranty or it's, you know, a card debit, and it's not all on the back of the site, which then filters back down to the providers, that's gonna be a cost that's gonna be hard to overcome. In the brick and mortar world, that cost is absorbed by the user. So if you want $500, I mean, I remember when $500 would cost you 10%. I remember when every check cashed, a check is a paper thing, when every check cashed was 6%. But now what's happened is everything that happens, whether it's on the rail or it's ACH or anything else, it falls back in the lap of the book. Can I just jump on that? You're talking about the fact that the operators are going to pick up the cost, but that's no different with any other industry. So especially from a consumer perspective online, that cost is- Online. online. So that payment cost is always picked up irrespective of whether it's gaming or not. So I think that's just the norm. And I think that's what's really is important from a consumer perspective is to have that parity, that consistency where we start talking about when they go to a cashier page to go and check out, they want to be able to see Apple Pay as Cameron referenced earlier. They want to go and have a look at, you know, whether they go to Macy's or John Lewis or wherever they might be spending their money, they want to have that consistency and online. The cost is always picked up from an online perspective by the operator. But what I can see now is that certainly from a card acquiring perspective, the margins are very, very competitive. In order to try and win business, we're talking about fractional costs there. And so you have to try and think about, is the pricing becomes a real commodity? You wanna try and look at how you can differentiate yourself so that you can actually work with the operators and give them some value adds that they'll need going forward. Whether that's, I don't know. Ford systems that they might wish to have, other products that you can leverage with regards to from a cost perspective. I know that there are payment providers who arguably give their acquiring away for free, which makes it very challenging to go and compete within that environment. Yeah, and just to clarify, agreed, except for the fact that the point was, had this industry been more accepting of the banks and the car brands have been more than accepting of what was going to be the reality online? And the model that could have been followed would have been the brick and mortar model in sport, not anything else. It would have been an easier pill to swallow. And I think there would have been more margin to be made not only on the provider of the services being us, but it would have been an easier thing for the book. So you're not going to put it back in the box now. The point is, because of the problems that we had, you know, having this market accepted in the US, it changed the way that things were already. poised in the brick and mortar world. It would have been nice to bring that model over. So, and one of the things there that you bring up is the difference in who pays for it, the land base versus digital. And certainly one of the things that came about a couple of years ago that I've been surprised at how slowly it's permeated within this industry is cashless payments. So, George, touch on that from your perspective, where you see that going over the next couple of years. And ultimately, certainly from an operator perspective. could there ultimately be an Omni channel wallet that somebody could use across their digital channels and land-based supply? Yeah, I'm kind of in a weird spot right now because the sport technology, like the app technology that we're providing at Every for sport teams that right now has nothing really to do with sports betting other than it's reality. You don't think about a pandemic being great for the industry, but in a way it was a great thing for cashless because people were scared to death. I remember, and I know that you all have heard this, that it'll never be the same. Now, I didn't believe that. I mean, we have short-term memory, and so now we're back to where we're really not afraid to touch money and touch things, and it doesn't have to be cashless. So I see that as a real budgetary problem in the sports side. But the snowball has started to roll now in the gaming side. And I think that it's going to be up to us to keep pushing product out, to keep that going. you know, transaction and whether it's brick and mortar online or other is where not only it is now and it was accelerated by COVID for sure. But I think now our responsibility is to not show that was a product built out of desperation. It's a product that's built for the future. Yeah, you know, I'll jump in there and think from a from a cashless perspective on the operator side. We were just having this conversation yesterday about when we look at retail sports books. Customers are constrained by how much cash they bring to the book, their ATM limits. And, you know, one of the things we're trying to balance right now is, is there an appetite for point of sale, you know, chip and pin, debit transactions to place your sports bet rather than paying with cash? And then it gets back to the cost perspective. Are you converting cash customers to a more expensive cost method? Or are you actually providing additional lift on top of the cash that they would have spent, because now they don't have to go to the ATM to spend $10 or $5. They can just use their card at the retail location to place the bet. Maybe they originally would have only spent the 100, now they spend 200. So it's something that we're taking a look at now. And from the Caesar's perspective, I think absolutely our goal is to move towards an omnichannel wallet approach. We're the largest brick and mortar casino in the US. multi-million number of customers that have the Caesars Rewards card. So we really see that as one of the value adds for Caesars, both on the digital and the brick and mortar side. And how do we mesh the two of those? How do we take your Caesars Sportsbook app or your Caesars Casino app, tie it to Caesars Rewards and make that balance usable, not just for sports wagering, but also maybe you had a big win and you want to take the family to Nobu or go see Adele or pay for your room. How do we really blend that all together so you truly have a Caesar's wallet that can be used online and in retail? Oh, excuse me. Here's my card. When we're done, I know how to do that for you. I was about to jump in and say that Nuve has an omnichannel solution. He's already got my card. First pitch competition is this afternoon, so we can come back for that. I did hear Warren say earlier that some providers give their services away for free, so I'm just waiting for that one to come up. fractional margins, but for exclusive business. But with regards to Omnichannel, I think it is important the fact that that, you know, player centricity is so important. And Trent was referencing as well, being able to understand, have information, knowledge, insight about your player, irrespective of channel and being able to go and have a payments partner who can actually bring all those threads together in easy dashboards to understand that, I think is crucial to be successful going forward. That allows you to understand who your customer is. They're playing bad behaviors, patterns, deposit withdrawals and such like. And that's valuable. That's like gold. And so as a result, then you can build a better relationship with the customers that you want to build a relationship with and grow your business. And I think to Warren's point, one of the things I've been thinking about is we've always done a good job of segmenting customers based off of their spend or their loyalty or mark from a marketing perspective and custom tailoring options for... you know, bonuses or welcome offers to the customer based off of their value to the business. But I think there's a I think there's a some room from the payment side to kind of bring that in into perspective as well. And how do we measure, you know, how do we how do we understand that Warren is, you know, this type of player in this demographic with, you know, this income level and cater the payment options or the payment mix to him? You know, Matt was talking about the warranty versus the unwarranty solution. I think there's benefits in both. You've really got to use that data to drive that decision making that, you know, you trends, you know, a dodgy guy, we want to send him down the guaranteed route. So we're not taking on the risk Matt is. But we know Cameron is, you know, a good customer. He's been a long time customer for, you know, with us, he's never had any returns. We've never had any problems with him. Well, let's pay a little bit less and send him down the non-warranty, you know, the non-warranty route, which helps awesome optimize the customer experience, as well as, you know, as, as controlling costs from an operator perspective. Sorry, to jump on the back of that, being able to have that ability to orchestrate between warranted and non-warrantied, I think is crucial. And so having a warranty solution, as Matt said, is really important. That takes a lot of stress and pain away from the actual operator. Being able to have a non-warrantied solution where you can go and reduce your costs significantly. If you've got that insight that we were talking about earlier, it's really good. But being able to couple the two, you don't want one or the other. It's having a hybrid solution. which Nuve has as well, is really where you want to go going forward. Well, as I expected this flew by, I want to thank all of our panelists. Thank you, everyone. Thank you for listening to our Gaming Daily, sponsored by OptiMove. We're looking forward to seeing you in Lisbon.