German Facing Online Casino Operators Cut off by Visa and MasterCard

The German iGaming expanse is one of the most lucrative casino gaming destinations, even though the country hasn’t yet regulated the practice.  A huge number of operators have been flocking the German market but things are taking a sour turn for these operators. Now that the country’s government plans to start raking in tax revenue from regulated online casino gaming by June 2021, the state authorities are fighting tooth and nail to ward off unlicensed online casino operators.

The latest attempt by Germany to curb the unlicensed gaming sites has been the restriction of the use of Visa and MasterCard by German players on these platforms. Visa even went as far as sending a memo to its partner banks, instructing them to desist from facilitating any payments related to online casino gambling in Germany.  These two payment options are the most popular transactional merchants for online casino players in the German market, meaning that players will certainly feel the impact of their unavailability.

Mounting Pressure From German Authorities

Sources close to the matter indicate that the German government and other authorities associated with local gambling had put a lot of pressure on Visa and MasterCard to refrain from processing transactions in offshore online casinos that accept German players. This is a huge blow for the operators because last year, PayPal was also pressured into walking away from the German online casino market.  Come January, local banks were also warned by German authorities to refrain from processing any transactions that are related to offshore online casinos.

With Visa and MasterCard following suit, it now means that four of the most popular payment processors for online casino transactions can no longer allow players to load or cash out from their gaming accounts. While there are plenty of alternative payment channels for German gamers, things just got more difficult for both offshore operators and players.

But then again, as harsh as the new restrictions are, the mandate doesn’t sweep across all online betting verticals. German facing offshore betting sites such as Bwin and Topico are still accepting Visa transactions, but only for their sports betting clients. It appears that there’s a loophole in the recently enforced measures that allow for Visa sports betting payments given that online sports betting is accepted in Germany.

Regulated Online Casinos in Germany Coming Soon

This crackdown on payment merchants not only controls illegal gambling but it also paves way for the regulated online casino plan for the country that is poised for a 1st July 2021 debut. The objective of German authorities is to approve online casino gaming but still place limitations on how the operations shall be conducted to ensure that the industry is a safe entertainment hub for gamblers.

Some of the restrictions on Germany’s regulated online casino industry include barring any form of third-party affiliate marketing, preventing players from logging on to two different online casino sites at the same time, and capping the amount of money that player can spend on slot machine stakes. Until then (July 20211), all offshore online casino operators serving players in Germany are doing so without state approval and are therefore illegal, however reputable the platforms may be in other markets. Likewise, any financial transactions to and from these platforms are deemed illegal, it's no wonder why PayPal, local banks, and recently Visa and MasterCard gave in to the pressure.