Which payment methods can Germany rely on for gambling in the future?

German players will have to continue playing online casino games without PayPal. The online financial service has cut ties with internationally licensed operators after an injunction was served by the government on October 21st. Transactions to and from online casinos will no longer be available as a result. Several sites such as iGaming Business, have reported that products without authorization by state jurisdictions will be banned.

With German residents restricted from using PayPal as a deposit option for online casinos, we ask what the future holds as far as payment methods goes in Germany. 

Online gambling in Germany

Online gambling is legal in the local state of Schleswig-Holstein, which issues online casino licenses for operators. Between 2008 and 2012, this was the only state where gambling was allowed in the country. In an attempt to open up the market, new rules came into effect in 2012 on a state by state basis. But this has led to more confusion among players trying to make sense of the strict regulations put in place.

While there is a crackdown on the online casinos in the country, sports betting is still available with PayPal. To get a better understanding of what is really going on we asked Thomas Hahn, German gambling market expert at Leadstar Media, to clarify matters.

“The issue is for companies operating both casino and sportsbook under the same umbrella, if the two are associated with each other, they are not allowed to offer PayPal as a payment option any longer.”

Some online gambling operators have therefore separated their online casino product and sportsbooks. According to their site MyWettbonus.de, german betting sites with PayPal is still a viable option for the players. 

When asked what this means for them as an affiliate, he said:

“The German market is a big one for us, so obviously it hasn’t gone unnoticed as this is kind of a big deal in Germany. We’ve had to make some changes to stay up to date with the current bookmakers that offer PayPal as well as the online casinos we list on MyCasinoFreunde.de. It’s too early yet for us to see any impact of this, but Germany is a country that adapts swiftly to new trends. As long as we update our visitors with the latest information in regards to this and offer other solutions, it shouldn’t have too much of a negative impact on us. ” 

The future of online gambling in Germany

Online casinos are still not allowed to market towards consumers outside of Schleswig-Holstein, but that might soon change. The remaining 15 states in Germany have plans to license online sports betting in the coming years. June 30th 2021 has been earmarked as the date for states to have reached a consensus. 

Whether or not PayPal’s new German terms of service will still be effective by then is unknown at this point. New payment methods have the potential to rise in Germany, leading to a battleground in terms of market share.  

Right now, exciting payment providers such as Trustly and Klarna are options available to the German market and are set to increase in popularity with PayPal out of the equation. On top of that the likes of Apple Pay and Google Pay are also well placed to benefit in the future.