Given that New Zealanders are moving increasingly towards a cashless system, more online banking solutions are expected to emerge in the coming years. Today, payments are made instantly, a development that has favoured both consumers and businesses.
If there are some new companies that want to have their share in the overcrowded market they’ll need to deal with fierce competition first. They’ll have to overcome the goodwill and reputation that PayPal has managed to earn itself ever since it became available in 2008 as it is now known as one of the leading electronic payment services. Paysafe, however, is an example of a new generation payment method that has dared to step forward and boldly challenge PayPal for its share of the market.
It does so by following a completely different approach and casino fans seem to be liking the alternative, discrete, solution Paysafe has brought them. In this guide, we will therefore take a closer look at both payment solutions. We’ll tell you more about why both have turned out to be successful and what they’ve brought to the online casino industry.
About the two
We think it’s fair to say that PayPal needs very little introduction. This American stock-listed online banking service allows users to transfer funds easily to businesses or individuals, while money can be stored as a PayPal balance to be spent at the user’s convenience. When it was introduced in 2008, it was one of the very first e-wallets that gave its consumers the opportunity to make an online transaction without having to grant the seller access to their banking information. As one of the first companies fulfilling the role of intermediary it quickly managed to build on its brand reputation giving it a significant advantage over others. Nevertheless, PayPal is notorious for its fees which are particularly charged if there is a transaction between a business and a consumer of two businesses.
Canada-based Paysafe was launched 4 years after PayPal but doesn’t enjoy as much international recognition as its online counterpart. One of the reasons for this is that both solutions follow a different strategy. Whilst PayPal is focused on providing online transactions and fills in the role of intermediary, Paysafecard originally was a prepaid voucher that needed to be purchased at a physical point of sale. By first purchasing the voucher and next inserting the voucher code on the merchant’s payment page, any direct links between the buyer and the seller were avoided, giving the buyer a lot more discretion.
In a field, as disputed as the online casino industry, animosity is still highly appreciated, thus quickly leading to the widespread popularity of Paysafe’s method of facilitating transactions. Today, Paysafe is also available in the form of an e-voucher, making the process even more accessible for users across the world. Both PayPal and Paysafe are known as instant solutions, which is why they are widely featured at fast payout casinos.
|PayPal vs. Paysafecard Comparison|
|Year of Launch||1998||2002|
|Available in New Zealand||Yes||Yes|
Availability of PayPal and Paysafe
One of the technological developments that have accelerated the growth of the online casino industry is the ease of how online payments can be concluded. In recent years, Paysafe has managed to stretch its availability from a more niche option, like online gambling platforms, into one of PayPal’s most important rivals in the market for online payments. The list of websites that now allow the use of Paysafe is impressively varied, ranging from webshops to online dating apps to streaming services and sportsbooks. Yet, Paysafe or Paysafecard’s presence in the casino industry remains strong, also in NZ, where it is considered a low barrier option to get engaged in the online casino action.
PayPal was the main banking solution on eBay for years, although this changed in 2018 when eBay decided that it was letting go of PayPal as its primary banking method to be able to lower processing costs for selling parties. PayPal is still to be found on an extensive range of websites, including Netflix, airline websites, and some of the biggest webshops in New Zealand. Whilst Paysafecard gained force in the online gaming market and is now looking for market share in other industries too, PayPal is now making the opposite steps, trying to look for more dominance in the market of real money online casinos.
Security of PayPal and Paysafe
There will also be privacy concerns that come with payment companies such as PayPal and Paysafe, but the good thing about both methods is their solid reputation. Both PayPal and Paysafe are used by major companies across the world, adding a lot of value to their own brand reputation. Whilst that alone doesn’t make the services fully secure, it does mean users can be confident that any issues can be resolved quickly. As both PayPal and Paysafecard work with the biggest companies on earth, their web security needs to be spotless at all times which is why most efforts are put into guaranteeing safe banking.
It also explains why buyers have requested two-step verifications and why PayPal gives its users a guarantee that all purchases are protected. Paysafe has its own system of working with prepaid top-up cards with which you can pay directly at selected webshops. This also means that you need access to the code on the card to be able to finalize the purchase which makes it difficult for third parties to intervene, especially when it concerns a physical card. All prepaid cards hold a certain value, meaning that scammers that obtain access to your voucher can never spend more than the available amount on the card. This makes Paysafe one of the most straightforward and thus safest possible solutions.
Online Casinos and PayPal and Paysafe
PayPal’s story with online casinos is an interesting one as they’ve had a difficult relationship, to say the very least. Once, PayPal was widely accepted in online casinos with the US as the world’s leading digital casino industry, but everything changed in 2011. On the 15th of April 2011, the United States Department of Justice decided to prohibit online gambling in order to stop large-scale money laundering — commonly known as Black Friday in the online gambling community. PayPal was one of the payment solutions to pull back its services from any online casino-related activity, including online casinos.
PayPal has seen quite the opposite situation on the other side of the ocean. When the UK Gambling Commission decided to ban credit card companies from online casinos in April 2020, British players abruptly had to search for alternative payment solutions with PayPal being one of them. PayPal, therefore, gained more territory thanks to a ban that saw two of its main competitors expelled from one of the world’s biggest online gambling markets.
Interestingly, in 2018, the US Supreme Court overruled the Professional and Amateur Sports Protection Act of 1992, revoking the long-standing federal ban on sports betting. This has given each US state the right to flex its laws concerning sports betting. The decision to revoke the national ban has also greatly favoured online casinos which is why there are more and more US states allowing both sports betting and casino games. A similar scenario is found in Canada where an increasing number of provinces are allowing online casinos and other forms of online betting.
It is therefore expected that PayPal will continue to grow in North America whilst Paysafe is also ready to take its share of markets that open up to gambling. Paysafe has been widely available in online casinos as consumers have been looking for a discrete alternative. Not everyone wants to be tied to online gambling-related expenses and Paysafe gives its users the chance to make payments in an anonymous way. Paysafe is, therefore, one of the most popular banking methods and is widely featured at online casinos is not only North America, but also in New Zealand. Despite being competitors, Paypal and Paysafe are known to be the best of their kind, catering to different needs.