Payments
Open Banking
Definition
A regulatory framework requiring banks to provide standardized API access to account data and payment initiation. Used in iGaming for KYC verification (income/affordability data) and instant deposit/withdrawal.
Why it matters
Open banking has had substantial commercial impact on iGaming payments and compliance. The technology enables instant authenticated deposits without card payment friction (Trustly being the dominant vendor in iGaming), instant withdrawals through similar rails, and access to verified bank data supporting affordability checks and KYC verification. The combined effect on conversion, customer experience, and compliance has been one of the more impactful changes in iGaming infrastructure over recent years.
The regulatory framework varies. The EU PSD2 directive established open banking as a regulatory requirement across the EU; the UK introduced its own framework around the same period. The US has moved more slowly toward formal open banking but bank-data services through Plaid and similar providers serve similar functions. The trajectory across major markets is toward expanded open banking capability, with iGaming as one of the most adopting sectors. APP fraud risk is a known concern with open banking deposit flows, requiring specific operator controls.
Frequently asked questions
How does open banking work in iGaming?
Player authenticates to their bank through the open banking flow, authorizing the transaction. Funds move instantly from bank account to operator. The operator receives confirmation of the transfer along with bank-verified account holder data. No card involvement, no card scheme fees, no card chargeback risk. The same rails support withdrawals back to the same authenticated bank account.
Is open banking available everywhere?
Most established in the EU (under PSD2) and the UK. Available in many other markets through commercial bank data services. US adoption has lagged but is increasing. Adoption in iGaming follows the broader payments infrastructure development per market.