High Risk Merchant Services Solutions for Sports Betting

High Risk Merchant Services Solutions for Sports Betting
                High Risk Merchant Services Solutions for Sports Betting

Gambling has a murky history in the United States whether it is on of any form. Location is the basis of legality as some areas allow it and some did not thus creating a challenge for credit card processors.

On Monday – May 14, 2018, it was ruled by the U.S. Supreme Court that the nationwide ban that was made by the Federal Government on sports betting was unconstitutional and it is not the one to decide regarding the legality of sports betting. The 1992 Professional and Amateur Sports Protection Act (PASPA) which has made sports betting illegal was considered invalid. This has been the result of the long battle between New Jersey and the major sports leagues.

What Is PASPA – The Federal Ban on Sports Betting?

PASPA or Professional and Amateur Sports Protection Act also known as the Bradley Act was signed into law in 1992 by President Bush. The bill was originally introduced by Bill Bradley on Feb. 22, 1991, who is a former professional athlete with a 13-year NBA career in his term as a Democratic U.S. Senator.

The bill prevented states from offering legal sports betting and is broken down into four sections described below.

  • In the first section, the terms were defined as used in the bill.
  • The second section tackles on the unlawfulness for a state to operate or give license for sports betting and gambling that takes place on professional or collegiate sports events.
  • The third section gives permission to the U.S. Attorney General or even an athletic league to go to federal court to report and stop any state or entity who is suspected to violate the law.
  • The last & fourth section lists gambling exemptions such as lotteries and horse racing.

It was left to the decision per state and each state now can choose whether or not they want to allow this form of gambling. The states can now freely determine on their own whether they see gambling on sports is legal within their own borders. New Jersey has already passed its law and after two weeks of the ruling, some businesses will begin to take a sports bet. The said ruling has opened up the possibility of other states to legalize sports betting soon. There were some projections made that 32 states will legalize sports betting within the next five years that will soon bring the underground sports betting into the light. Some states have shown interest in legalizing sports betting like Delaware, Mississippi, New York, Pennsylvania and West Virginia and some of these states has already passed legislation and are likely to begin the buildup of the necessary infrastructure for the businesses to start taking bets.

Since there is a move to legalize sports betting across the country gradually, it is just right to expect that there will be more doors that will be opened for businesses that would like to capitalize with the expanding industry and thus also increase the number of online processing options. With this ruling, merchants are collectively excited about the possibilities they have in the sports betting industry.

The future of sports betting still depends on how individual states decide to proceed. It is not difficult to imagine a future where placing bets are as easy as opening an app on your phone. Technology will play a lot in this move to legalized sports betting in America and even in the whole world.

There is one interesting fact about the sports betting industry – it operates much like Wall Street where there are strategies and tactics of professionals and amateurs. Betting your all is not advisable but instead to bet using spreads leaving your portfolio to be diversified.

This sports betting niche falls under the high-risk merchant accounts. Making it not easy for businesses under sports betting to find a reliable processor that can handle the transactions safely and legally. That is why a merchant must think thoroughly as to which payment processor they will get their merchant account.

Credit card giants are not eager to offer credit card payments for sports betting and one the most significant reason for this are the volume of chargeback that may be involved. There are two possible reasons seen that will make the customer ask for the chargeback. One is they will pretend that the one who used their card for online payment wasn’t them as they may feel ashamed or embarrassed to see their massive betting on their statement of account. And second is that the spouse of the cardholder does not recognize the charge when they examine the statement of account thus ask for the chargeback. Payment fraud may also be an issue as well as refunds and out if country sales giving all the reason for the sports betting to be high risk
While the card brands ponder over the possibilities of credit cards for sports betting, hopefully, they’ll have a solution to counter the probable rise in chargeback as a result.

About High Risk Merchant Services Solutions

We at IPAYTOTAL do our best to open each business relationship with a 10-minute conversation to find out the key elements of a business before going forward. Immediately, we establish a connection with prospective merchant partners and decide then and there whether or not we’re able to find high risk merchant services solutions for them.

We guaranty quick real-time credit card processing, top-notch services and at reasonable rates. Give us a call at +44 800 776 5988 or get in touch with us through our website.