For years, up to 25% of all deposits to online casinos in Germany have been made using PayPal – but that’s history now. PayPal has been one of the highly popular solutions on the Internet since the success of eBay. There was nothing you couldn’t pay with PayPal. The legal basis for PayPal has always been the State Gambling Agreement from Schleswig-Holstein. However, since this contract has expired and was not extended, the payment provider decided at the beginning of January 2019 to discontinue the offer for online casinos completely.
The Beginning of the Story
Since the verdict of the Federal Administrative Court, it clarified that under German law, by prohibiting online casinos, likewise the transactions to these are not permitted. Thus it is possible, what has already been done several times, not to fulfil claims of an online casino or the payment service provider such as PayPal. By claiming the ban, the payment service providers would never have been allowed to carry out transactions, and so this was illegal. This results in the fact that no claims can be brought against customers and they do not have to pay the amount to the online casino. PayPal had already tried to counteract this with fees for online casinos and to compensate possible resulting losses. However, it can be assumed that more and more Germans took advantage of the legal situation and PayPal lost more and more money. A no longer profitable business with online casinos in Germany, through unpaid claims, in addition to the pressure from politics and justice seem here probably the main reason for the withdrawal. Since it does not concern wanted measures on the part of the virtual gaming halls as with the CasinoClub, the Party Casino as well as the 888 Casino, but a decision of PayPal is. It might follow soon further PayPal Casinos. It can be assumed that this payment service will no longer be offered in Germany shortly.
The first undertakings concerned are 888 Holdings and GVC Holdings. The gambling groups are represented in Germany by online casinos such as 888 Casino, CasinoClub or Party Casino. With them, it is no longer possible for customers to select PayPal as a means of payment. GVC has also announced that it will remove PayPal as a payment option from all of its online casinos in Germany from 19 December. So far there are no known restrictions with other providers. However, it is still completely open whether PayPal will exclude further online casinos in the future.
Possible Scenario for Netteler and Skrill?
The problem with PayPal casinos could have an even greater impact in the future. This is because other payment service providers are also affected to the same extent by the various judgements. It is also possible that Skrill or Neteller will increasingly turn away from Germany because of losses due to lawsuits and non-payment. After all, it is the main task of companies to make profits and, if at some point costs and benefits no longer pay off, an exit from the market is ultimately the last logical step.
Consequences of the PayPal shutdown
PayPal is above all simple, secure and convenient. PayPal has also been used for deposits and withdrawals in the online casino. Deposits were credited within minutes. Most casino payouts were credited from most online casinos within a maximum of 72 hours if approved.
But another important reason why the elimination of PayPal is bad for gamblers is that PayPal didn’t offer its services to any casino. To be able to offer the coveted payment provider, the gambling provider already had to show certain standards. In addition to player protection, data protection and fair gaming, as well as a strong license, should also be mentioned here. That’s why a PayPal casino was always more trustworthy than one without PayPal.
When it comes to offering possible payment methods, the providers of online gambling virtually outbid each other. Companies know that in a competitive market, offering attractive and widespread payment options is an absolute must to attract new customers. That’s why common means of payment such as credit cards and cash transfers have been part of their repertoire for a long time, and the popular worldwide PayPal is also part of it at many online casinos. Besides, they usually offer various additional options, such as online wallets like Skrill or Neteller.
In the meantime, providers of online gambling have even occasionally started to include cryptocurrencies such as Bitcoin or Ethereum in their range of accepted payment methods. Critics, however, complain that companies use these untraceable transaction channels to open the door to crimes such as money laundering or terrorist financing. However, the multitude of payment options also makes online casinos less dependent on individual financial service providers. So if PayPal excludes all gambling companies in the future, customers will still find enough ways to transfer funds to their accounts.
Trustly Casinos with No Registration
The Swedish payment service provider Trustly could also profit from the entire development of PayPal at online casinos in Germany. It is quite similar to an eWallet but has a different approach with its infrastructure, such as the Trustly app. Here, customers can easily top up money on their smartphone and then transfer it to the online casino concerned via the Trustly application. Banks, for example, hardly play a role any more in this way. Apart from that, there are also Trustly casinos with Pay N Play without complex registration, which should appeal to just as many customers.