Why do conventional banks avoid online gaming operators?

Many banks lack knowledge of the online gaming industry and regulations, so they are hesitant to open accounts for e-gaming companies. Financial institutions often impose strict requirements on e-gaming companies before allowing them to open high-risk merchant accounts in Europe.

As e-gaming companies are considered high risk, they are often rejected by banks and instead have to work with a high-risk payment processor familiar with the i-gaming industry and already provides gaming merchant services. One of the main reasons banks and payment service providers reject e-gaming companies as new gaming merchant account customers is the issue of chargebacks. Banks also consider e-gaming companies high risk because of the danger of disputes over bonus claims and the risk of gambling addictions. Regulatory scrutiny and their classification as a ‘high risk’ enterprise limit their ability to process payments in some jurisdictions.
 

The proper solution

Our solution is to create a structure combining a local Curacao e-gaming company, which holds the gaming license, with a merchant account located somewhere in the EU. Because Curacao is legally part of the EU, falling under the jurisdiction of The Netherlands, it enjoys some special privileges, such as having the validity of Curacao e-gambling licenses being accepted automatically, without having also to impose the financial restrictions that go with EU full membership.

In a few of the cases we have dealt with, we set up the banking and merchant account facilities in the UK or Cyprus, with online gaming activities based in Curacao, as well as credit card processing and the movement of funds between customers and the e-gaming operator.
 

The 5 steps in setting up the infrastructure for an e-gaming business in Curacao

For any e-gaming company there are five essential “must-have” components:

1. Curacao company formation –  that is the holder of a sublicense for e-gaming
2. A bank account for gambling company that caters for high-risk payment processing companies
3. A merchant account/payment service provider (PSP) designed to optimize i-gaming payment processing
4. Associated EMI (Electronic Money Institution) accounts that channel the PSP transactions
5. A holding company somewhere in the EU banking domain as the legal entity that sets up and controls the necessary financial accounts – bank (which is not mandatory), EMI and merchant / PSP.
6. Curacao casino bank account – your newly Curacao company will need to open a bank account for managing their operational funds and also for plyers funds account. we can assist with that