Online Gaming Payment Systems: How to Level Up Your Skills

The video games market is projected to grow to $363.20 billion by 2027. What’s more, the number of users is expected to reach 1,472.0 million by the same year.

Undoubtedly, online gaming payment is rapidly evolving, and that growth also means that more and more money are being involved. To ensure a smooth online gaming payment process, you need to first know the essentials.

Let’s get right into it.

What Are the Types of Payments in Online Gaming?

1. In-Game Purchases
2. Subscription Services
3. One-Time Game Purchases
4. Mobile Payments
5. Gift/Prepaid Cards
6. Peer-to-Peer Payments

1. In-Game Purchases

In-game purchases, also called microtransactions, are a very profitable market, which is expected to reach $219.4 billion by 2032. This model is most widely used in games that are  free to play, but players have to pay in order to obtain cosmetic upgrades (skins) or gameplay advantages.

For example, League of Legends is a free-to-play online game that has many character skins. If they want to use them, players need to purchase RP points, which cost between $4.99 and $99.99.

“Microtransactions have revolutionized the gaming industry, turning games from a one-time purchase to a service model where continuous revenue can be generated. The success of free-to-play games proves how crucial in-game purchases are for game longevity.”

– Brandon Sheffield, Creative Director at Necrosoft Games

2. Subscription Services

Subscription services grant users access to libraries of games in exchange for a small recurring fee. Similar to how Netflix works, this model is becoming more popular in services like PlayStation Plus and Xbox Game Pass.

The latter, in particular, gives subscribers access to over 100 games for a fixed monthly fee, with new games added each month.

“Subscriptions are becoming a core pillar of the gaming industry. They allow players to experience a variety of content for a manageable price while giving companies a steady revenue stream.”

– Daniel Ahmad, Director of Research & Insights at Niko Partners

3. One-Time Game Purchases

This is the most traditional payment method: a person buys a game, and owns it forever. While this model has been dominant for decades, it is now losing its popularity, in favor of microtransactions and subscription services.

“While one-time purchases remain significant for AAA titles, the rise of digital services and microtransactions has shifted the focus toward creating ecosystems where players engage continuously.”

– Joost van Dreunen, Co-founder of SuperData Research

4. Mobile Payments

Mobile wallets like Apple Pay and Google Pay are increasingly popular in online gaming. This is because they are convenient (not requiring to enter credit card details repeatedly) and easy to use.

For instance, mobile games like PUBG Mobile or Clash Royale let you make in-app purchases through Apple Pay or Google Pay.

Additionally, major online platforms like Steam and Battlenet accept PayPal as a method of payment when purchasing games or in-game items.

5. Gift/Prepaid Cards

Gift and prepaid cards are used to load a specific amount of money that can be used for in-game purchases, or buying games on Steam, for example.

On top of that, such cards are often available in both physical and digital formats. This provides a convenient option for younger players without bank accounts. Retail stores like Target and Walmart, for instance, have Roblox and Fortnite gift cards.

“Gift cards provide a bridge for younger audiences or those without credit cards to engage with online gaming. They also make the perfect gift for gamers, offering flexibility for purchases across platforms.”

Lisa Hanson, Managing Partner at Niko Partners

6. Peer-to-Peer Payments

Some online games, eSports in particular, support peer-to-peer payments. P2P payments allow players to transfer funds to each another directly. 

This system also makes it possible for games to bet on games and tournaments, with the winnings transferred directly between users through P2P systems.

Common Security Challenges in Online Gaming Payments

1. Payment Fraud
2. Account Takeovers
3. Data Privacy Issues
4. In-Game Currency Theft
5. Malware and Keyloggers

1. Payment Fraud

One of the most common issues for online gaming payment processing is payment fraud. Unauthorized purchases from online criminals bring negative consequences for all parties.

Usually, scammers trick people into giving up their account information or payment information by sending fake emails, links, or messages in the game.

For the gaming companies, this means chargebacks, and for the users, it means losing their accounts. Additionally, some players maliciously make purchases, and then request refunds from their payment provider, claiming that they’ve never authorized the transaction.

2. Account Takeovers

Getting your account stolen is one of the worst things that can happen to a gamer, especially if the account has a lot of valuables. 

Keep in mind that some gaming accounts can reach a value of thousands. For example, a World of Warcraft account was sold for over $34,000 in 2021. You can imagine that the damage can be huge, if you lose such an account.

The most frequent methods scammers use to steal accounts are:

• Phishing. This tactic is all about tricking people into sharing their sensitive information. Attackers impersonate real companies, sending users emails, or in-game messages that aim to lure them into fake payment portals. The end goal is to steal credit card information, login credentials, etc.
• Brute force attacks. Brute force is a hacking strategy that uses automated bots, which attempt various passwords until they get access to the account. Brute forcing can work really well if the user has a weak password. In practice, your account can be stolen in a matter of seconds or minutes.
• Social engineering. Social engineering is a more sophisticated way of stealing accounts. It uses the tactic of revealing specific information about the target, and ultimately manipulating them into sharing their own information.

3. Data Privacy Issues

On a larger scale, hackers target gaming companies to steal users’ sensitive information (payment details, addresses, and other personal info). Then they either sell this data or use it for further attacks.

Any data that is not encrypted during transmission or storage is particularly vulnerable to such attacks. What is more, companies that do not comply with privacy laws (GDPR, CCPA) risk legal consequences and heavy fines.

4. In-Game Currency Theft

In-game currencies are almost always purchased with real money, so stealing these currencies is just like stealing money from someone’s bank account. Of course, hackers target such digital assets, so that they can resell them on the black market.

On another note, some players try to abuse microtransactions by exploiting weaknesses and gaps in the payment system of the game. Their aim is to either get free items/currency, or take advantage of the refund process.

5. Malware and Keyloggers

Both malware and keyloggers are most often spread through unofficial game mods, free downloads or cheat software. Once they infiltrate the user’s device, they start capturing sensitive information.

Again, the end goal is for hackers to steal payment information, or gain control of game accounts.

What Is the Role of a Payment Gateway for Online Gaming?

1. Ensure Smooth and Secure Transactions
2. Support Multiple Currencies and Payment Methods
3. Enable In-Game Purchases and Microtransactions
4. Enhance User Trust and Compliance

1. Ensure Smooth and Secure Transactions

Payment gateways need to do everything possible to make sure both the platform and its users are protected from fraud. This includes implementing prevention mechanisms, such as encryption, tokenization, and two-factor authentication.

On top of that, online gaming payments need to be fast, instantaneous actually, and happen in real time to keep user engagement.

2. Support Multiple Currencies and Payment Methods

Another important aspect that payment gateways must cover is the successful integration of multiple payment options and currencies. This is mandatory, because the gaming industry has a global reach.

Enabling players to pay in their local currency provides a better overall user experience, and the same goes for supporting local payment methods, like UPI in India and WeChat Pay in China.

3. Enable In-Game Purchases and Microtransactions

As we established earlier, microtransactions are a very profitable market. So, it is only logical that payment gateways should make it possible to handle these low-value, high-frequency transactions without any problems.

The most important thing is to ensure that they are handled quickly and with little-to-no delays.

4. Enhance User Trust and Compliance

Gaining the trust of users is vital for any online gaming platform. After all, people who don’t trust them will probably not be willing to spend their money. 

One way to earn said trust is by complying with security standards, like PCI DSS. This will ensure user data is protected, and will help you to detect and prevent fraud.

How to Level Up Your Skills with Electronic Transfer

Online gaming payment systems are extremely important to the gaming industry. In order to achieve smooth and secure transactions, they must ensure robust encryption, fraud prevention, and compliance with industry safety standards.

For gaming companies looking to elevate their payment solutions with speed, security, and reliability, Electronic Transfer Inc. (ETI) offers the cutting-edge tools needed to build user trust and optimize revenue. 

Connect with ETI today to explore how these services can transform your gaming platform’s payment experience!