Cash was king. If there was any moment for the gaming world to make a definitive shift of transaction paradigms, the last two years’ rapid transition into a cashless and touch-free world may be it. The pandemic forced even the staunchest luddites to learn how to operate QR codes and adopt alternatives to physical currency. Brick and mortar gaming facilities, forever a citadel of paper money, minted coins, and ATM lines, are now accelerating their two-decade push towards making digital payment solutions ubiquitous in casinos and other gaming establishments.
Major industry organizations, casinos, and technologists have increasingly rallied around digital wallet technology to anchor the customer gaming experience. This alert provides a high-level assessment of some of the risks, benefits, legal considerations, and other observations on the gaming industry’s growing adoption of digital wallets.
What are digital wallets and how are they different?
Picture something like Apple Pay. A digital environment (e.g., an app) stores a user’s payment information, which they can then use for transactions through devices like a smartphone. Unlike physical prepaid cards, users can’t lose a digital card, and it allows the exchange of money in and out of the account, enabling users to cash out directly into their digital wallet. Unlike certain other prepaid cards or similar accounts, casino guests can also use these wallets to shop, dine, or pay for other amenities such as parking, tickets, spa treatments, etc. Gaming operators are calling this the “omnichannel approach.” Additionally, customers might enjoy lower transaction fees on digital wallet purchases compared to potentially more costly ATM fees. Finally, digital wallets might allow gaming companies to better integrate payment apps with loyalty and rewards programs and their related benefits.
Is this just a trend?
Nobody can force user adoption, but major gaming companies are embracing or developing digital wallet technology en masse as a new amenity to their guests. This includes installing modified slot machines and service kiosks to accommodate technology like QR codes and tokenized wallet transactions, among other notable updates to the analog gaming experience. Recognizing the consumer demand for these options, at the beginning of the pandemic, the American Gaming Association encouraged states and tribes to adopt its framework for regulating this technology. Regardless of whether they will become the dominant transactional medium in gaming, digital wallets are likely here to stay.
Is it safe?
The last few years highlighted the potential health and safety benefits of touchless transactions, and digital
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