The Impact of PayPal's Return to US iGaming

Published September 19, 2015 by Elana K

The Impact of PayPal's Return to US iGaming

PayPal is re-entering the US online gaming market with a debut in a Nevada online casino, and soon hopes to take on New Jersey casinos as well.

PayPal is breaking (back) into the online gaming market in the United States. Last week, Caesars Interactive Entertainment (CIE) became the first US-licensed online gaming operator to offer PayPal as a payment option. CIE is licensed in Nevada, and according to iGaming Business, PayPal is also expected to debut in New Jersey casino in the next few weeks.

PayPal’s History with Online Gambling

Way back in 2002, when eBay acquired PayPal, one of their first orders of business was to shut down PayPal as a payment method for online gambling sites. The reason for this was largely due to legal and regulatory issues; namely, the Patriot Act. In fact, in 2003, eBay settled with the US government over charges that PayPal's services to gambling merchants in 2001 and 2002 had violated the Patriot Act.

Fast forward to 2015, when online gambling is legal in three US states. PayPal is already used in casinos across Europe as a payment method, so it was only natural that the company would want to get a piece of the American pie as well - especially because now, the legislation is in their favor. When PayPal pulled out of gambling sites in 2002, online gambling accounted for approximately 6% of PayPal’s revenue.

US Online Gambling

As of now, three states have legalized and regulated online gambling: Nevada, New Jersey, and Delaware. At the same time that more states consider following suit, there is a strong lobby to ban online gambling at a federal level. It is difficult to tell which way the winds are blowing, but as long as online gambling is allowed at a state-level, PayPal will have a chance to increase its revenue.

About PayPal

PayPal is a service that allows people to pay online or on mobile without sharing financial information. Since its launch in 1998, PayPal has received more than 20 awards for excellence from the internet industry and the business community.

 

See also

Poker and Betting Events, PayPal and US News

GiGse 2015 Speaker Projects US iGaming Growth

Return of the US Wire Act Thwarted

Credit Card Companies Move Toward Regulated US iGaming Transactions

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