5 Steps to Implement Smart Payment Routes in iGaming

Want to boost payment success rates by up to 40% and reduce fees by 30% in iGaming? Smart payment routing is the answer. It automatically selects the best payment paths in real time, improving transaction approval rates, reducing fraud, and recovering failed payments.

Key Benefits:

• Higher Conversion Rates: Up to 40% improvement.

• Cost Savings: Cut payment fees by up to 30%.

• Fraud Reduction: More than 20% decrease in losses.

• Failed Payment Recovery: Minimum 15% recovery rate.

5 Steps to Get Started:

1. Review Your Payment System: Identify weak points, ensure compatibility, and comply with legal standards.

2. Use AI Tools: Automate multi-currency processing, retries, and fraud detection.

3. Set Routing Rules: Optimise by location, currency, and risk management.

4. Strengthen Security: Implement AI-driven fraud detection and comply with Malta Gaming Authority (MGA) regulations.

5. Monitor Performance: Track metrics like approval rates, costs, and fraud detection to adjust strategies.

For Malta's €1.34 billion iGaming sector, where millions of euros flow daily, smart payment routing isn't just helpful - it’s essential for staying competitive and compliant.

How to integrate the best payment gateway for an online casino

Step 1: Review Your Payment Infrastructure

Evaluate your payment system to identify potential weak points that could lead to costly disruptions in Malta's busy iGaming sector.

Identify Payment Process Issues

Failures in transactions often stem from system downtimes or unreliable connections with acquirers and banks. To tackle these, monitor these KPIs:

• Transaction Success Rate: If below expectations, implement retries across multiple PSPs.

• Processing Speed: Adjust routing algorithms when delays occur.

• Decline Recovery: Distribute transactions across various merchant accounts to reduce declines.

• Currency Conversion Efficiency: Assess and switch forex providers if performance is lacking.

This analysis helps pinpoint areas needing improvement for smarter routing.

Ensure Device and Platform Compatibility

Once you’ve addressed processing issues, confirm that your system works seamlessly on all devices. Use tools like BrowserStack for cross-browser and real device testing to ensure consistent performance.

"Thanks to parallelization, we get through 20,000 tests in a couple of hours on BrowserStack. It saves us a lot of time, money, and effort"

GoodRx achieved a 90% reduction in testing time, enabling them to release updates 15 times daily. This demonstrates the importance of efficient testing.

Comply with Legal Standards

Your payment system must include:

• Identity verification processes

• Transaction monitoring tools

• Anti-money laundering (AML) procedures

• An appointed Money Laundering Reporting Officer (MLRO)

Failing to meet these standards can result in fines of up to €500,000 or imprisonment for up to five years. Regular audits are essential to comply with PMLFTR regulations.

To enhance routing efficiency and maintain compliance, use parameter-based routing, considering factors like issuing country, transaction amount, currency, risk level, and past performance.

Step 2: Select AI Payment Management Tools

Core Payment Routing Functions

To tackle operational challenges and boost efficiency, iGaming platforms rely on AI-powered payment management tools. These tools handle complex transactions with features such as:

• Multi-currency processing with competitive exchange rates

• Real-time transaction monitoring and detailed reporting

• Dynamic routing based on transaction success rates

• Automated retries for failed payments

By automating these processes, platforms can reduce administrative effort by up to 50%.

How AI Improves Payments

AI payment systems transform transaction processing by learning from past payment data. They use this information to make smarter routing decisions, considering factors like:

• The likelihood of transaction success based on historical data

• Cost efficiency across different payment providers

• Risk evaluation for each transaction

• Geographic and time-based trends

• Customer preferences and behaviour

"We're seeing things emerging in smart routing. Not just a set of business rules, but much more dynamic based on pricing and time of day to incentivize customers' behaviours." - Gareth Lodge, Celent

For example, AI can analyse up to 30 data points to optimise payment routing, improving success rates and campaign performance.

These advancements enable solutions like Fluid's platform to fine-tune every payment process for better outcomes.

Fluid's Payment Solutions

Fluid offers a comprehensive solution for managing payments in iGaming. Here's what it brings to the table:

Fluid's intelligent routing system works like a "Trivago for payments", letting payment providers compete to process transactions based on performance metrics. This ensures the best routing decisions while maintaining top-notch security.

Security features include:

• Monitoring transaction velocity

• Verifying geolocation

• Analysing device intelligence

• Tracking digital footprints

• Detecting VPN usage through IP analysis

These measures are essential, especially as fraud in the industry rises by 30% annually.

Step 3: Set Up Payment Routing Rules

To ensure smooth transactions in iGaming, it's crucial to set up effective payment routing rules. This means configuring parameters that direct payments through the best channels while keeping security intact.

Location and Currency Rules

Routing payments based on location and currency helps reduce costs and improve approval rates. For example, transactions can be directed to regional Payment Service Providers (PSPs) depending on the card's origin. Matching transactions to local currencies also avoids unnecessary conversion fees.

Offering local payment methods during checkout can also boost authorisation rates. Once you've optimised for location and currency, make sure to secure the process with strong risk controls.

Risk Management Rules

The iGaming industry is increasingly targeted by fraud, with digital fraud rising by 68.6% between 2019 and 2021. To protect both operators and players, implement robust security measures like:

• Transaction Monitoring: Use velocity limits and flag unusual activity.

• Geographic Restrictions: Block transactions from high-risk areas.

• Device Intelligence: Employ tools like fingerprinting and IP analysis.

• Amount Thresholds: Set transaction limits based on assessed risk levels.

"Perhaps unsurprisingly, iGaming saw a big rise in physical adversary-in-the-middle attacks in 2024. With sign-up and other bonuses on offer, multi-accounting, identity farming, and account takeover have become increasingly prevalent in this vertical - with physical adversary-in-the-middle attacks the means with which to drive these fraud tactics."

• Ira Bondar, Senior Fraud Group Manager at Veriff

Ensure your system can enforce these rules smoothly. Regularly review and update them to keep up with evolving threats.

Rule Performance Analysis

Ongoing analysis of your payment routing rules is key to maintaining efficient payment flows. Keep an eye on these metrics:

Use decline data to fine-tune your risk management settings. Platforms like Fluid's allow you to monitor these metrics in real-time, ensuring your payment routing strategy stays effective and adapts to market changes.

Step 4: Add Security and Compliance Tools

Effective security and compliance measures are critical for iGaming payment systems. Fraud costs the industry over €27.5 billion annually, so implementing strong protections is essential.

AI Fraud Detection Setup

Here’s how to set up AI-driven fraud detection:

One online casino reported a 30% drop in fraudulent transactions within six months of implementing such a system. AI establishes a baseline of "normal" behaviour for each user, making it easier to detect anomalies like sudden changes in betting habits or unusual deposit amounts.

Payment Rules Compliance

Malta's MGA and FIAU require operators to adhere to strict compliance standards:

1. AML/CFT Implementation

   • Use anti-money laundering controls, including:

     • Risk-based assessment procedures

     • A Customer Acceptance Policy

     • Transaction monitoring systems

     • Appointing a Money Laundering Reporting Officer (MLRO)

2. Data Security Standards

   • Align data protection measures with PCI-DSS requirements:

     • End-to-end encryption for payment data

     • Secure access controls with two-factor authentication

     • Regular security audits and penetration testing

"AI is reshaping the landscape of online gambling fraud prevention. By using machine learning, pattern recognition, and real-time monitoring, AI is helping operators detect and prevent fraud faster and more accurately than ever before." – SDLC Corp

Security Updates and Checks

Once fraud detection and compliance systems are in place, regular updates are necessary to maintain their effectiveness. For example, one major poker platform reduced collusion-related incidents by 30% after deploying AI-based security measures.

Stay informed about regulatory changes by subscribing to MGA and FIAU newsletters. Regular testing by external teams can uncover vulnerabilities before they’re exploited.

Fluid’s platform integrates these security measures with its AI-powered system, ensuring real-time monitoring, automatic updates to security protocols, and compliance with changing regulations.

Step 5: Track and Improve Performance

To optimise smart payment routing in iGaming, it's crucial to keep an eye on key performance metrics. Surprisingly, around 40% of multinational merchants only track one to three payment metrics, potentially missing out on areas for improvement.

Use Data to Monitor Results

Focus on these core metrics to evaluate transaction success and user experience:

With Fluid’s dashboard, you can track these metrics in real time, making it easier to identify issues and fine-tune your routing strategy.

Adjust Rules Based on Trends

When trends emerge in your metrics, it's time to tweak your routing rules. Consider these areas:

• Transaction Patterns: Analyse geographic and time-based patterns to optimise routing. For example, prioritise faster processors during peak gaming hours.

• Cost Efficiency: Regularly review and compare processing fees to minimise costs.

• Risk Management: Use updated data to refine fraud prevention parameters and improve security.

These adjustments will directly influence your overall performance.

Measure Success Metrics

After updating your rules and tracking data, evaluate your success using these metrics:

For instance, in 2024, Banxa, a global leader in crypto infrastructure, achieved a 22% success rate and recovered €6.4 million in revenue by implementing smart routing. This highlights the tangible benefits of continuously refining your payment strategy.

Conclusion: Smarter Payments with Dynamic Routing

Dynamic payment routing in the iGaming industry helps reduce costs and boosts transaction approval rates by selecting the best transaction paths in real time. This approach ensures efficient payment processing, offering proven results in the market.

Fluid's AI-driven technology has shown tangible results, as highlighted by David Hodkinson, founder of Xace:

"As a financial institution deeply rooted in iGaming, Xace recognises the immense potential of Fluid to revolutionise payment journeys for operators. Their technology delivers measurable impact".

With digital payments expected to reach approximately €10.4 trillion by 2025, dynamic routing and ongoing optimisation are becoming essential for building secure and reliable payment systems.

By leveraging these advancements, operators can refine their payment processes using Fluid's AI-powered tools, which provide intelligent routing, robust fraud prevention, and a smooth user experience. Roberto Rubio, CEO of Fluid, emphasises this progress:

"This investment marks a significant milestone for Fluid as we continue to push the boundaries of what payment technology can achieve in the iGaming sector".

FAQs

How can smart payment routing improve payment approvals and minimise fraud in the iGaming industry?

Smart payment routing improves payment approvals and reduces fraud by dynamically selecting the best payment route for each transaction. It considers factors like card type, currency (€, EUR), and player location, ensuring smoother processing and fewer declines. This approach increases approval rates, helping operators avoid false rejections that frustrate users and lead to lost revenue.

Additionally, smart routing enhances security by analysing transaction risks and directing payments through trusted providers. By leveraging AI-driven tools and dynamic routing algorithms, it ensures that payments are processed efficiently while reducing exposure to fraud. This tailored system is particularly valuable in the fast-paced iGaming sector, where seamless and secure transactions are crucial for user satisfaction.

What AI tools can help improve payment routing efficiency in iGaming platforms?

AI tools like contextual multi-armed bandits (MAB) and AI-driven fraud detection systems can significantly enhance payment routing efficiency. These tools dynamically adjust routing strategies in real-time, helping to optimise payment success rates and minimise transaction failures.

Additionally, leveraging machine learning algorithms can improve fraud prevention by identifying suspicious patterns and ensuring secure transactions. By integrating these advanced tools, iGaming platforms can provide a smoother and more reliable payment experience for users.

How can iGaming operators in Malta ensure compliance with regulatory standards when implementing smart payment routing?

To comply with Malta's regulatory standards, iGaming operators must adopt a risk-based approach to anti-money laundering (AML) and countering the financing of terrorism (CFT). This includes implementing robust controls and procedures to identify and mitigate risks effectively. Operators are also required to appoint a Money Laundering Reporting Officer (MLRO) and adhere to the Gaming Authorisations and Compliance Directive.

The Malta Gaming Authority (MGA) ensures compliance with the Prevention of Money Laundering Act (PMLA) and related regulations. Non-compliance is reported to the Financial Intelligence Analysis Unit (FIAU). To stay compliant, operators should regularly review their procedures, provide staff training, and maintain detailed records of transactions and risk assessments.

Related posts

• How to Optimize Payment Conversion Rates in iGaming

• Mobile Payment Fraud: Common Risks and Solutions

• Personalized Payments in iGaming with AI

• How Regional Payment Habits Impact iGaming Conversions