Online casinos have come a long way from the archaic websites we used to have. With modern graphics, AI-driven game personalization, and new games released regularly, players today are spoiled for choice.
Payment options are another area in which almost all reputable online casinos have made significant strides. While Visa, Mastercard, and a few additional options used to be the standard, most gambling platforms now feature a list of exceptional payment options ranging from bank payments to crypto. Support for e-wallets has also become standard across the industry.
Determining which payment method is best, particularly for fiat currency players, relies on several essential factors. If you’re unsure which you should opt for, follow along as we look at the key differences between bank payments and any of the many e-wallets on the market.
Laws Surrounding Gambling Transactions in the US
Before deciding whether bank payments or e-wallets are better for US players, let’s examine the laws impacting these financial transactions. Doing so is especially important because bank payments are subject to various laws and are stunted by the effects of a law passed almost two decades ago.
The Unlawful Internet Gambling Enforcement Act (UIGEA) was passed in 2006. At the time, all forms of online gambling were strictly prohibited throughout the US, with the 1992 Professional and Amateur Sports Protection Act (PASPA) helping keep activities like sports betting at bay.
Although many believe the UIGEA makes it illegal for players to make financial transactions to an online casino operator, the law actually does the opposite. It makes it illegal for any operator to accept payment from an individual for the purposes of gambling via the internet. This act was carefully crafted in an attempt to deter offshore operators from accepting American players.
Banks, payment processors, and credit card companies, however, were the ones responsible for detecting, reporting, and blocking all financial transactions between players and operators. As such, banks nationwide developed automatic protocols that blocked transactions between customers and companies with a Merchant Category Code 7995, which designates gambling.
After PASPA was overruled in 2018, many states legalized online sports betting and even fully fledged online casinos. However, banks still have frameworks built and refined to ensure UIGEA compliance. Many are unwilling to change these systems, irrespective of new laws that make gambling legal in various states.
The result is that bank payments used to fund player accounts in the US have a high failure rate, with many automatically rejected by banks. This is one of the leading factors against using bank payments if you’re a US gambler. However, using your bank as a payment method has other distinct pros and cons.
Banking and Debit Cards
Using your bank to deposit into your player account (or to withdraw any possible winnings) is done as an electronic check, eCheck, or via the Automated Clearing House (ACH) Network. These payment methods are supported by almost any licensed casino within the US and are among the safest ways to transact.
Among the most significant benefits of using ACH or eCheck payments is their incredible security protocols. Because these transactions are conducted by heavily regulated institutions, they follow stringent rules, filters, and checks. This means that there is a greater chance of detection if anything is amiss with the transaction.
In addition, these payment methods offer familiarity as they operate in the same manner as if you’re paying for anything else, such as your monthly bills. They also come with more significant transaction limits, which are particularly useful if you’re lucky enough to claim a substantial windfall.
On the negative side, ACH and eCheck payments are often painfully slow due to their numerous checks and security features. While some operators offer instant deposits with these methods to help alleviate wait times, withdrawals often take a long time, with an operator utilizing its processing period and financial institutions adding on three to seven days.
Those wishing to keep their gambling private should also avoid bank payments, as every detail of these transactions is meticulously recorded and appears on your bank statements. That is, if your payments go through at all due to the abovementioned problem caused by the UIGEA.
Paying using your bank card, whether Visa or Mastercard, is another widely accepted alternative to eCheck or ACH. These offer instant deposits and are more convenient. However, these also have high decline rates as payments still run through your bank and can be limited when used as a withdrawal method.
E-Wallets
As an alternative to bank payments, e-wallets have become a popular method used by millions across the US and internationally. One of the prime examples of an e-wallet, PayPal, operates very similarly to a bank but without the cons typically associated with bank transfers. Other popular providers include Neteller, Skrill, Revolut, and Zelle.
The most significant advantage of using an e-wallet is that there is little chance of your payment being blocked due to UIGEA security. E-wallets also provide an additional layer of security by never sharing your actual banking details with operators. This protects you from possible data breaches or cyberattacks.
Additionally, e-wallets often provide instant deposits and withdrawal processing times that are significantly reduced compared to using your bank. They also provide additional privacy, as payments to or from an online casino won’t appear on your primary bank statement. Many providers also offer dispute resolution services and operate under strict regulations that protect you and your money.
The final advantage to using an e-wallet to fund your online gambling is that it can allow you the chance to better budget for gambling online. This is because you can choose to fund your wallet only with what your budget allows. Because it is separate from your main account, you’ll know you’ve hit your limit once this money is gone.
Despite these great advantages, e-wallets also have some disadvantages. Chief among these is some leverage fees for transactions, which could cause your final deposit amount to be less than you intended or lower the winnings you may be withdrawing. These fees also come with the inconvenience of having to work through an intermediary between your bank and the operator.
Finally, not every operator supports every e-wallet. While those mentioned above are widely accepted, you may find an operator that doesn’t support the e-wallet you use. This will mean you may need to open another e-wallet, something you may not want to do.
Final Say
Despite their disadvantages, e-wallets are easily the best option for US players seeking to gamble online. Because they can circumvent archaic UIGEA protocols and offer additional benefits, using e-wallets can lead to a less stressful and more enjoyable gambling experience.
