In this new Winneronline column, casino insiders give their opinions on issues that affect both casino operators and online gamblers.
Online casinos have an incredible number of people that play, but really don’t pay. Many players will choose a casino, deposit money with the casino on their credit card, and play away all their deposit. Then they immediately think that, because they did not win, the casino doesn’t have fair odds or is in some way trying to cheat them. So the player charges back their credit card the original deposit and the casino is left in a position where they must pay the winner but can’t collect from the loser.
This is a serious problem for online casinos and I estimate that the average online casino has approximately 200 gamblers that are trying to cheat them. At casinos I’ve operated, we’ve experienced months where we’ve lost up to 25% of our business in chargebacks.
These dishonest gamblers, and those that try to defraud online casinos, hurt other players as well as casinos. If more people that gambled online were honest, there would be far fewer problems with chargebacks and casinos could give players much bigger bonuses to keep them coming back.
To help understand how serious this problem is, let’s look at a typical online casino’s profit line.
If an online casino has 1 million in total wagers in a month, they’re lucky. Take that 1 million in wagers and figure that there was a total of $36,000 in deposits played to reach that 1 million. Now take 25% of the $36,000 that was deposited and give it back to the gambler plus a $5 fee for the charge back.
Now that you have $27,000 left, what happens to that? The credit card merchant gets their 8%, then the balance gets wired to the casino. It’s not over yet though. The casino then has to pay its winners. That accounts for about $35,000! Whoops. Now you’re in the hole $10,150.
Now that your casino isn’t profitable (and most aren’t) what do we do with those Togel Singapore gamblers that requested a chargeback that results in your business owing money at the end of the month? We blacklist them! These people that charged back resulted not only in your casino losing money, but in the overall industry having a shady reputation.
I’m a firm believer that you go to the source of the problem. In this case it’s the gambler that just can’t imagine that they actually lost. I’d like to see the same people go to Vegas and try this nonsense. It just wouldn’t fly.
We need to stop chargebacks. They have a poor effect on all involved. Honest gamblers don’t get the attention that they deserve and honest casino operators are forced out of business.