MasterCard and Visa have issued a couple of new credit card codes which would allow them to distinguish between legal online gambling and illegal online gambling. The three new codes are as follows, 7800 for state-run online lotteries, 7801 for state-run online casino games, and 7802 for state-run online dog/horse racing. Their hopes are that this will make it easier to differentiate between legal gambling transactions and illegal ones.
The main problem banks have been having with this is the sign-up process at each online gambling site. Depending on each site and how their money deposit system works, they’re forcing some banks to keep a close eye on all of these transactions.
Another good reason banks are reticent in allowing online gaming transactions is due to current federal laws. On the other hand the good news is that payment processing is getting better and better, especially now with these new credit card codes in tow. Furthermore these new MCC codes are not seen as a one time-boost type of deal, but as something that will continually improve payment processing for the foreseeable future. As time goes on numbers of users of online gambling are expected to continue climbing. More banks are accepting the new codes and all operators will continue to push MasterCard and Visa as they start getting more comfortable with the approval rates.
And finally, online gaming operators and regulators in states that have legalized iGaming have been reaching out to banks and financial institutions in order to educate them about online gambling and myths surrounding it.