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the News desk.
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| Paypal to end gambling protection in several
countries |
12/05/16 |
|
 Editor |
• Paypal removes
protection 7 months after rejoining the market
Paypal has announced it is to stop protecting payments made
by customers for online gambling transactions in a number of countries,
including the US, Canada and Brazil.
The online money transfer giant
will amend its Payment Protection policy and User Agreement, with the changes
impacting buyer and seller protection, as well as dispute
resolution.
Paypal’s updated list of ‘ineligible items’
for protection will include “gambling, gaming and/or any other activity
with an entry fee and a prize”.
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The move will also
impact customers in certain countries that use Paypal for making payments to
crowdfunding projects..
“This is consistent with the risks and
uncertainties involved in contributing to crowdfunding campaigns, which do not
guarantee a return for the investment made in these types of campaigns,”
Paypal said, according to the BBC.
US Online Poker and DFS
Affected
PayPal was once the biggest processor of online gambling
transactions in the world, but it voluntarily withdrew itself from all markets
in 2003, due to the then legally gray nature of the sector in most
countries.
In 2010, it began accepting gambling transactions again, but
only for licensed operators in jurisdictions where the online gambling was
fully legal and regulated. Last year it quietly began to offer its services to
the regulated US online poker markets of Nevada and New Jersey, and it also
processes transactions for daily fantasy sports in the US.
To be clear,
the withdrawal of payment protection for online poker deposits is unlikely to
have a major effect on the consumer market. Simply put, the regulated online
gambling industry with which PayPal now engages is unlikely to run off with
anyone’s money anytime soon.
PayPal also added other kinds of
transaction to its updated list of items ineligible for Purchase Protection.
They are “anything purchased from or an amount paid to a government
agency” and “and/or any other activity with an entry fee and a
prize.”
The U.S. Department of Treasury began accepting PayPal on
Pay.gov, which accepts payments to government agencies in February 2015, while
the payment platform started allowing U.S. gambling sites to use it again last
September after a 12-year ban. Both developments gave PayPal more revenue
streams following its spin-off from eBay, and removing them from Purchase
Protection mitigates the company’s exposure to risks.
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