The iGaming industry in Canada is seeing some exciting changes in 2024. The main reason for that is Fintech (Financial Technology) development. More provinces are following along in Ontario’s footsteps and creating their own online gambling regulations. As a result, the number of opportunities for innovation seems to increase day by day.
These come in many forms but mostly touch on payments, banking, and customer experiences. A true Canadian iGaming Renaissance is being brought about by emerging trends in AI tech, blockchain, open banking, and other spheres like RTR.
Everyone Wants a Piece of the Pie
As more and more online casinos are being legalized and regulated across a growing number of provinces in Canada, every offshore company wants a piece of the pie. But the key to sustainability involves more than just securing a license and offering impressive experiences. In order to succeed in this ultra competitive market, smooth banking processes are a must. A perfectly operating fintech infrastructure enables deposits, cashouts, and responsible gambling.
Fintech is an area where iGaming actually falls behind many other industries and verticals. The customer experience for funding accounts still has room for improvement (and sometimes leaves a lot to be desired). Recent fintech innovations can help to speed up this improvement.
Key Fintech Trends in iGaming
As the iGaming landscape matures in Canada, several fintech trends seem poised to transform the industry:
Artificial Intelligence and Machine Learning
AI and ML are being used to solve a variety of challenges in the industry:
- Enhanced KYC/AML – AI-powered identity verification would for example drastically limit the number of bad actors on any given platform. This would apply not only to document validation but also transaction monitoring. In an effort to protect against money laundering, and also build trust with regulators.
- Customized Experiences – Machine learning algorithms can learn from player behavior. They can process patterns and output personalized experiences. This could be used to tailor promotions or to recommend ideal games. As a whole, it would increase player engagement and operator revenues.
- Fraud Prevention – Realtime AI tracking of deposits offers a new layer of fraud prevention. With real-time data, the casinos could quickly flag suspicious activities. This would enable teams to quickly identify potential fraud and cheating.
- Automating Processes – Generally speaking, chatbots and virtual assistants save operators an incredible amount of resources. Tedious back office tasks such as payment issues, data management and reporting can be automated by AI. This would cut costs while increasing operational efficiency.
- Risk Modeling – By applying machine learning to various customer data points, operators improve risk ratings on customers. It allows for better user protection.
Streamlined Payments with Open Banking
A variety of inconvenient funding options have occupied the online gambling space for ages. With the development of online banking, it started changing. Using financial APIs, operators can now offer instant deposits/cashouts directly from a player’s bank account.
Not only does this eliminate friction and delays with traditional payment methods, open banking provides rich data to better understand finances and risk.
While adoption is still slow, offering open banking payments to Canadian players could become an important competitive edge.
Blockchain and Cryptocurrency Support
Blockchain-powered technologies will disrupt multiple areas of iGaming. Benefits would range from better supply chain tracking to loyalty programs tokens. But the most immediate fintech impact comes with supporting cryptocurrency payments.
Already proven in other markets, adding crypto deposits and cashouts opens the door to new groups of users. Additionally, it impacts the growth of the web3 economy. It requires a digital wallet infrastructure with on/off ramps into users’ desired currencies.
In 2024, regulators are seeking to balance innovation with responsible growth. As a result, enabling self-restricted limits and safeguards to identify problematic behavior will be key here.
Embedded Finance
Embedded finance is the integration of financial services like payments, lending and money management into a business’ existing processes. Finally, this innovation reaches the iGaming sphere.
Potential applications include:
- Deposits and cashouts smoothly enabled via game tutorials or loyalty programs
- Casino line-of-credit offers funded as customers play games
- Personalized payment plans for large cashouts automatically set up based on user data
This makes the experience smooth while increasing the cash flow cycle for operators. Embedded finance will be a rising trend across fintech. Industries like iGaming are going to benefit from it greatly.
Key Opportunities in the Canadian Market
Canada’s high fintech innovation adoption will drive new opportunities, including:
- B2B Fintech Services – Such services as managed payments, banking, compliance and embedded finance solutions can become a great solution for small gaming platforms.
- Neo-Banks for Gamblers – A digital bank specifically designed around the needs of online bettors. From dedicated account managers to exclusive promotions tied to cash flow, there is much room for innovation.
- Crypto Integration Services – Smoothly integrating deposits and withdrawals in leading cryptocurrencies across various iGaming sites into a unified e-wallet.
- Faster Payments Platform – Enabling instant, open banking-powered transfers would solve one of the biggest issues in the industry.
- Prize-Backed Savings – Turning loyalty points earned on gaming sites into automatically managed prize-linked savings. This would appeal to millennials and gen-Z users.
The booming iGaming market in Canada, coupled with its leadership in emerging fintech, offers players unique experiences in 2024
Conclusion
Canada currently evolves its own way in regulating online betting and casinos. In this situation, it is important to ensure that the developing fintech technologies can catch up with the regulations and users needs. This way, it is possible to create an exceptional user experience. In addition it can create trust with oversight bodies, as well as a variety of competitive advantages for operators.
