While Visa and MasterCard have said they will allow the payments to go through in states where online gambling is legal — New Jersey, Delaware and Nevada — card issuers such as Bank of America Corp. and Wells Fargo & Co. say they won’t process online-gambling transactions. The same goes for other mainstays, including American Express Co. and PayPal.
Alternatives, including wire transfers, Automated Clearing House transfers, cash deposits at casinos and cash deposits at third-party businesses are all available methods of depositing funds.
Congress passed a bill in 2006 that made it illegal for companies to take online bets. For seven years, financial institutions have been conditioned that if you process a payment related to Internet gaming, the ramifications, the penalties, were very severe. That seems to be a condition of the mind very difficult to change.
New Jersey enacted a law earlier this year making online gambling legal within the state’s boundaries, but many banks haven’t become accustomed to processing the transactions.
Geolocation software, provided by Geocomply, demonstrates each login that received a blue dot on the map was approved for play, while red dots showed those that were blocked.
Blocked logins from Florida and even internationally blocked attempts also appeared on a map last week as the company demonstrated how the technology is being used in New Jersey.
GeoComply’s technology allows operators to see why a player has been blocked. In many cases, the blocks are occurring because users do not have Wi-Fi enabled on their computers or are running a type of software that has the ability to hide a computer’s location.
New Jersey regulation requires that online-gaming companies be able to show that their systems meet or exceed the state’s standards, which include four verification elements:-
Geolocation and payment-processing are the most significant problems the state will continue to face in the coming months as other states look to New Jersey to see whether online gambling can succeed.
There are financial implications, as well. Atlantic City’s casino industry and the state are looking to the revenue streams that online gambling will provide, since more players accessing the systems will mean more needed revenue. A report by Fitch Ratings earlier this week predicted the industry will yield $200 million to $300 million in revenue in its first year, well below Gov. Chris Christie’s initial predictions of $1.2 billion.
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