PayPal has fallen back into old habits after its split from eBay. Prior to its absorption into the eCommerce giant back in 2003, PayPal had been a leading payment processor in online gaming; now, after a period of quiet on that front, it’s back on two online gambling sites – DerbyGames.com and WSOP.com.
The shift has happened with little fanfare from PayPal, perhaps out of a desire not to raise eyebrows over perceived legal uncertainties; online gambling is illegal in most US states. There is also a heightened risk of fraud in online gambling, which has reportedly cost PayPal in the past. But there are also significant opportunities for payment processors, with online gambling raking in millions of revenues where it is available.
Moreover, PayPal has lately been angling to become the global leader in digital payments broadly, and has been pushing to digitize payments where they are currently processed via traditional methods; in other words, the company’s greatest ambition is to become the world leader in payment processing. To that end, it has stepped up its efforts in areas ranging from in-store mPayments to global remittance transfers since gaining independence from parent company eBay earlier this summer. With that in mind, settling back in at the online gambling table makes sense; it’s just another area PayPal needs to take over if it’s going to lead the entire payments industry, in the long run.