Thursday, July 07, 2022

Balancing better payment options with compliance concerns

Casinos across Asia must find a way to balance innovative new payment solutions with a labyrinth of multi-jurisdictional AML, compliance and responsible gaming requirements, according to a number of industry insiders.

Payments has long been one of the most important but least talked about topics within the gaming industry.

One supplier told AGB on condition of anonymity that innovation in the payments space "remains a thorny issue", adding that while operators don’t want to lose customers, the need to adhere to strict AML requirements tends to take precedence.

However, in recent years a number of payments providers have entered the Asian market with the promise of new products designed to smooth transactions between customers, banks and casinos, and make it easy for customers to spend on the casino floor.

One of these providers is Everi Holdings, a New York-listed payments giant with a large Asian footprint. Everi provides its payments Compliance product in Saipan and Vietnam, its Cash Access and ATM services in Macau, its self-service CXC 4.0 kiosks in Macau, Vietnam and the Philippines, and its Central Credit product in a majority of casinos across the region.

Darren Simmons, Everi's SVP, Payments Solutions, told AGB that integrating cash handling and AML compliance solutions provides operators in Asia with a single, expert source to meet all requirements on the casino floor.

"In Asia we are proud to offer a full suite of payments solutions that drive additional funds to the gaming floor and increase casino staff efficiencies to allow for better customer interactions," Simmons said.

At the heart of this approach is a more integrated payments service, that connects with broader casino management systems to streamline compliance and also open up additional marketing opportunities. Many of the products now available to casinos in Asia have already enjoyed success in the US or European market.

“More and more, folks are hearing about the solutions we bring to the US marketplace and wanting to implement them in Asia,” Joe Pappano, SVP and managing director of Vantiv Entertainment Solutions, which provides payment services to a number of casinos and resorts in the US, told AGB.

Among these solutions are those powered by near-field communication (NFC) antennae, which allow customers to make mobile payments on the casino floor using a smartphone via a small sensor. It is the same technology that powers Apple Pay and Samsung Pay, although there are often regulatory hoops to jump through to ensure compliance.

Pappano said that while Vantiv Entertainment is not currently active in Asia, it is a market it continues to monitor closely.

“Longer-term, there is a lot that we can do to enhance the payments landscape in Asia and provide a truly frictionless solution. In general, we listen to markets and let them tell us what Vantiv products and services are of interest,” Pappano said.

However, the challenge for Asian operators wanting to implement the latest payments technology is the complex set of regulations that varies between jurisdictions.

Tim Shepherd, president of business development and marketing at casino operator Silver Heritage Group, which operates casinos in Nepal and Vietnam, said that while the operator strives to offer innovative payment solutions in its casinos, this must be carefully balanced with AML and compliance concerns.

"As an Australian publicly listed company working in emerging markets in Asia, we have to go the extra yard to demonstrate we are following all aspects of AML legislation on a continuing basis, and we engage outside consultants to keep us across new issues," Shepherd told AGB.

"In some jurisdictions our procedures are far more stringent than those laid down by the country in which we operate. However we are always looking for ways to give our players a trouble-free visit to our casinos," he added.

Silver Heritage uses a card-based cashless system provided by Osiros Limited in its Asian casinos. Card-based systems are becoming increasingly favoured in jurisdictions with strict regulatory frameworks, because the real-time player tracking they facilitate tends to make AML compliance less onerous.

As well as AML compliance, responsible gaming is another consideration when innovating around payments. Joan Alcorn, from TJ Gaming Consultants, sounds a note of caution on the dangers of pursuing new payment solutions that make it easier for players to bring money to the casino floor.

"[These new solutions may] speed up play and can be more convenient for customers, but in the long run no one will win. This is a highway to irresponsible gambling and at the end of the day will kill the cow that supplies the milk," Alcorn said.

"We are still somewhat old school and want a player to reflect on their losses and financial situation on the way to the cashier or ATM before getting more money," she added.

Alcorn also cautioned of the dangers of integrating banking and player details into casino management systems, warning that without flawless security, sensitive information is left vulnerable to data breaches.

This is not to say those innovating in the payments space cannot ultimately benefit the wider industry.

For instance, Asia's casinos tend to handle a higher rate of physical cash than their counterparts in the US and Europe, making it tougher to comply with AML requirements. A move towards cashless payments should lead to easier compliance.

The real challenge for Asia's casino operators is to find a way to integrate this new technology in a manner which benefits everyone.

Asia Gaming Brief is a news and intelligence service providing up to date market information for worldwide executives on relevant gaming issues in Asia.

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