Paysafecard Group has brought its prepaid voucher product to the U.S. online gaming market.
The Austrian company's move to the U.S. is through a partnership with the Bancorp Bank Payment Solutions Group, which it said is important because of regulatory change in the payments industry.
"Knowing the environment is [changing], partnering with a bank is a great idea," Neil Steinhardt, Paysafecard's U.S. general manager, said in an interview Monday.
Bancorp Bank Payment Solutions, a unit of Bancorp Inc. of Wilmington, Del., issues the vouchers while Paysafecard manages the program and processes the transaction functions as the program manager and processor.
Consumers may purchase Paysafecard vouchers at locations such as wireless phone card retailers. Consumers use a 16-digit PIN to complete a transaction at a participating gaming company's website or other online merchant.
NHN USA, a subsidiary of NHN Corp. of South Korea, is the first U.S. gaming site to accept Paysafecard vouchers. Steinhardt expects its European gaming partners to expand to the U.S. knowing that Paysafecard is an option for gamers.
Gaming "is our fastest-growing segment in Europe, and a lot of those companies were asking us why we're not in the U.S.," Steinhardt said.
Paysafecard expects to branch out to other digital content such as music downloads, Steinhardt said, though it does not plan to serve online gambling sites.
About 300,000 merchant locations sell Paysafecard vouchers in Europe and South America. The vouchers are available at about 12,000 U.S. locations. Paysafecard has distribution agreements with PreCash Inc. and is working with IPP of America Inc., the national network of independent neighborhood-based payment centers.
Adil Moussa, an analyst at Aite Group LLC in Boston, said a solid distribution network will help Paysafecard in the U.S.
Paysafecard's challenge, however, will be to persuade consumers that a voucher system is a good alternative to a prepaid card, Moussa said.
Entering a 16-digit code might prove to be cumbersome for some people, Moussa said. "I don't think consumers are used to the idea of grabbing a voucher and taking it back home as opposed to a plastic card" they have long been comfortable using, he said.
