PayPal Returns To U.S. Online Gambling MarketOnline Payment Processing Giant To Help Fledgling Industry |
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Online payment processing company PayPal has re-entered the American online gambling market through partnerships with the WSOP-branded online poker site and New York-based Derby Games, an Internet horse betting site.
According to a report from CNBC, PayPal was last involved with online gambling in the U.S. in the early 2000s, prior to the enactment of the 2006 Unlawful Internet Gambling Enforcement Act. The report said that PayPal has indicated it wants no PR from the news. Online casino gambling is only legal in three U.S. states and remains a controversial issue in some legislatures.
The return to online gambling comes just a couple of months after PayPal split with its former parent company eBay. PayPal has been involved with online gambling in Europe since it stopped processing those transactions in America. PayPal is valued at roughly $49 billion.
The UIGEA made it illegal for banks, credit card companies, and payment processors like PayPal to transfer funds from gamblers to online casinos, and vice versa.
PayPal is already involved with the growing daily fantasy sports industry, which some consider real-money gambling. Several states are looking at DFS legislation.
In a statement to CNBC, the company said: “PayPal is launching a pilot program to support four leading real-money gaming (RMG) operators to offer PayPal as a way for gamers to fund their online accounts with these merchants. We are launching this pilot now that we are able to fully comply with the evolving laws surrounding RMG in the United States as well as the requirements of our payment partners. As a global payments provider, PayPal’s goal is to give people safe and simple ways to pay for the things they want, so long as we can comply with applicable laws.”
The size of the real-money online casino gambling market in the U.S. could be worth $2.7 billion by 2020, assuming the likes of California and Pennsylvania regulate the industry by then, according to research and analysis by Morgan Stanley.
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