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Ways to improve casino business costs

Xace, a multi-licenced, global payment account provider serving iGaming firms, has launched a new payment solution: Era.

Shortly after securing its MFSA licence earlier this year – Xace introduced Era to provide free business accounts, and cross border payments solutions. Under the new offering, regulated iGaming companies can access multi-currency accounts and multiple banking rails with zero fees.

The launch of this new solution is designed to help iGaming businesses that are working tirelessly to carve out their position in a thriving, but over-saturated market.

Choosing the right banking partner is just one of a few big challenges faced by iGaming firms in 2024, alongside market saturation, compliance, security, explosive growth in AI technology.

These complex issues are forcing iGaming businesses to find ways to cut costs in other areas, whilst simultaneously juggling daily operations with licence acquisitions in pursuit of ambitious growth goals.

As Adam Grist, CPO at Xace, explains, “iGaming businesses are trying to pour their resources into securing licences, launching new products, and growing their customer base. As a regulated financial institution that serves iGaming companies, we know how much work these companies put into compliance.

“On top of that, some of the biggest firms in European and North American markets have told us that they face very high fees on their bank accounts and transactions, including FX.

“We’ve now introduced Era, which gives regulated iGaming businesses access to totally feeless payment accounts; there are no upfront costs or monthly account costs.”

Companies with licences from major iGaming regulators, including in the UK and Malta, are eligible for Era.

Finding and maintaining banking partners can be one of the most difficult tasks for iGaming businesses. Many banking solutions and payment accounts providers have a low risk appetite, making it hard for businesses to find low-cost stable providers.

As Grist puts it, “firms feel like they must walk a tightrope between choosing a banking partner that’s affordable and one that is prepared, willing, and able to offer services to iGaming firms. And even after a new account is opened, concerns over account closure aren’t always put to rest.

“As iGaming businesses are high-risk enterprises in the eyes of financial providers, many companies worry that their bank accounts may be suddenly forced to close, which can massively upset operations and cause even greater financial headaches.”

Other ways to improve casino business costs

iGaming businesses are taking other measures to distinguish themselves from the competition, including online casino platforms that are taking a variety of steps to cut costs.

At the heart of these efforts lies the needs of the customer, who increasingly expects seamless experiences, from registration to game play, and with every deposit and withdrawal.

In a highly saturated market, retaining new customers becomes even more important. New casinos and online gambling platforms are continuously being launched, and just a few sticky interactions could mean losing a life-long customer to a sea of competitors.

Instead of spending a fortune on research, many are turning to their own customer data sets to uncover insights into player behaviour that can guide strategies for product optimisation, launch and sunset. The focus on data insights is helping to fuel a larger effort underway: the growth of iGaming ecosystems.

More iGaming platforms are creating partnerships that offer wider benefits to their players. Through social media influencers, affiliate marketing, and co-branding opportunities, iGaming firms can position themselves as a feature of a desired lifestyle.

Loyalty programs, optimised with multiple partnerships offers, can both attract and retain customers. Companies can leverage customer data to constantly provide unique offerings that capture and convert target audiences.

Forming alliances is a necessary part of building a successful ecosystem of partners. In some relationships, iGaming industry knowledge will be critical, for example, a banking partner must truly understand the iGaming transactional processes and barriers in order to facilitate frictionless payment experiences.

In other relationships, iGaming industry knowledge is not required, and firms can look to form partnerships across various sectors.

Businesses can also take advantage of AI, which is already permeating all aspects of the iGaming industry. Solutions already include AML and counter-fraud checks, improved customer support services (AI chatbots), and enhanced iGaming experiences (with help from technologies like virtual reality and augmented reality).

From a cost-perspective, AI promises to deliver thousands of scaleable, regulation-compliant solutions. As businesses integrate AI into their platforms, it’s important that proper cost-benefit analysis is performed, so that any new software or programs—AI or otherwise—will provide valuable long-term gains.

Subscription models may provide smarter means for reducing upfront costs and only paying for software as it is used. iGaming firms can also seek out SaaS vendors that can meet their specific needs, be it partner of a certain sector, one that can meet volume requirements, or provide location-specific benefits.

Summary

In the face of all these challenges, iGaming businesses are finding new ways to cut costs, from adopting AI into their systems to choosing pay as you go software licensing subscriptions. In some of these cost-saving strategies, finding partners and providers who know the iGaming industry well is non-essential.

However, for banking accounts with high transaction volumes, iGaming businesses will need partners that know the industry inside-out. That way, online casino companies can cut banking costs with confidence, and focus their resources on growth and innovation.


David serves as the head of business development of Xace. He has 15 years experience managing a sales organisation and the last 18 months he has led the sales arm of the global expansion at Xace. In the five years prior, he served a similar role at gambling operators and service providers within the gambling industry.

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