Online gaming has several risks for any payment processor, but that has not prevented PayPal from making a re-entry into the industry in the U.S market.
PayPal cut ties with online gaming sites back in 2003 but they are now back in business, helping facilitate payments and deposits for several online gaming platforms. PayPal did not release any official statements to this effect, but their adverts can be found on WSOP.com, which is a leading online gaming site, and domain for the internationally acclaimed World Series of Poker.
PayPal left the online gaming world over ten years ago following its merger with eBay. At the time, the company deemed it vital to cut all sources of ‘excessive’ financial risk. Online gaming industry is only second to online adult entertainment in terms of the number of fraud attempts. The action taken by the company was therefore, perhaps, a prudent one at the time.
PayPal recently split from eBay. This has made it possible for the payments service to get back into the online gaming ring. The earning potential of the online gaming sector is one of the main reasons for the company’s return. Analysts expect the industry to hit the $5 billion mark by the year 2020 as more states are expected to legalise and regulate gaming sites. In the United States presently, there are very few states with legislation that allow online gaming.
Across the world PayPal is used widely on online gaming sites with many gamers seeing payments through PayPal as the safest way for playing games with real funds. Industry watchers are now looking to see if the payments giant will exert as much influence in the United States.
PayPal’s reluctance to discuss their new foray into the sector has left many experts wondering if there could be other motives behind the decision to get back into the game. The company has continued to take things easy in terms of public relations on the subject as they are yet to issue a press release to date.
One of the reasons that have been put forward by analysts for PayPal’s silence is that they may be trying to avoid putting their market status in jeopardy especially in states that oppose online gaming. Online gaming is still considered a grey area by many so the company may be trying to avoid attention.
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