Get Payment Processing for Online Sports Betting Advice
If you offer sports betting consulting services, prepare yourself for good times. After the Supreme Court struck down the federal ban on sports betting in 2018, the industry has been enjoying explosive growth. The US sports betting market is expected to hit $37 billion by 2025. As more states legalize the activity, there’s no better time than now to sell betting advice.
Despite looser regulations and increased social acceptance, it’s not easy to run a successful betting advice business. Financial institutions sometimes refuse to offer payment processing for online sports betting advice providers because they regard these businesses as high-risk industries. Without the ability to process online payments, you will struggle to sell picks and make a profit.
Why are Sports Betting Advice Businesses Considered High-Risk?
As of this writing, 30 states have legalized sports betting. But even in jurisdictions where sports betting is legal, banks are reluctant to provide payment processing for online sports betting advice businesses. From legal complexities to industry-specific consumer behavior, there are many reasons why financial institutions shun this industry.
Some of the most common reasons why sports handicappers struggle to access the payments system include:
Although Murphy vs. the NCAA gave states the ability to legalize sports betting, the gambling-like activity is still outlawed by federal law. This legal gray area is one reason why banks avoid sports handicappers.
High Rates of Chargebacks
Sports handicappers commonly sell their advice as weekly or monthly subscription plans. Subscription business models have higher rates of chargebacks because people often forget that they had signed up for the service.
More Payment Fraud
Online sports betting advice providers process payments over the phone or on the internet. Card-not-present (CNP) transactions have much higher rates of fraud than in-person payments. This makes online sports betting advice merchant accounts high-risk.
A top reason why banks don’t offer payment processing for online sports betting advice providers is a large number of dissatisfied customers in the industry. It’s very common for people that lose bets to dispute transactions in order to get their money back.