So with SiGMA closing it’s doors for another year and the event circus taking a well-earned break until the run up to ICE, we thought it worth reflecting on the key messages that came out from the last few days. The messages, themes, and topics were given heightened importance with the fines and ‘suspended’ licences announced by the gambling commission in the middle of the event. Nice timing and all wrapped up with the talk of a ‘super’ fine on its way!
So for what it’s worth, here is our view now we have got our breath back.
Regulatory overhaul. “Nothing new” I hear you say, and we would normally agree. However, the current pace of change is relentless and is sometimes hard to keep up with! It could be the move to a risk based approach from the MGA, the advertising bans in Italy and Australia, new regulation coming from Sweden, the various self-exclusion projects under way or the eye watering fines and suspensions keeping us glued to any communication from the Gambling Commission in the UK. No wonder it’s one of an operator’s biggest drivers behind much of the ongoing M&A activity.
Increased complexity and the ever growing cost of compliance means that efficiencies and improvements are a key focus for operators globally. From a supplier’s perspective, there is a need to recognise that we need to provide more. Taking multiple sources from multiple suppliers is becoming increasingly untenable, and there is an opportunity for all of those that can provide a greater depth and breadth to their offering, as clients struggle to stay ahead of both regulation and the competition and put the customer at the heart of their business.
KYC is dead. Long live KYC
Speaking of customers…..for anyone still hanging on to the belief that a system that has not really moved on in a decade still holds its relevance today surely any last lingering hopes that the current KYC process is fit for purpose have been buried once and for all. Limited, inflexible, time stamped data sources are simply not good enough. Dynamic, evolving and real time are the goals. If Safer Gambling is the single biggest focus from regulators then embracing the need to raise the bar in this area is a must. Simply meeting minimum standards is no longer sustainable.
USA, USA, USA:
There is an understandable excitement around the potential opportunities in the US as a raft (perhaps super tanker is a better analogy) of partnerships emerge in the post PASPA world. However those who invested in the space 4 to 5 years ago are heading the pack and you have to wonder how new entrants can compete with the partnerships already in play. The cost of entry is significant but if your mantra is ‘you have to be in it to win it’ then you had better have deep pockets and a long term view!
It’s NOT all about the US!
Hang on, didn’t I just say it was all about the US? Well precisely for the reasons outlined above many are electing to focus their efforts elsewhere. Africa, India and LatAM were put forward as the key battlegrounds for those that are choosing not to jump aboard the US bandwagon. Those markets have key countries that will lead the way such as Kenya for their mobile adoption, India for its sheer size and love of sport and Brazil for the tantalising prospect of sports betting finally breaking down the regulatory impasse. However like the US we can see the shrewd operators, who are investing now and prepared to take the long term strategic view coming out on top.
AI, VR, eSports, Blockchain, biometrics take your pick. The only certainty is that standing still will ultimately result in failure. How you embrace this and critically, how regulators adapt, will help define how the market grows.
Stat of the week. 5% of all bets placed worldwide is currently done via mobile. That gives everyone plenty to go at.
It’s OK to use the C word
Collaboration was key topic throughout SiGMA. Whether it was regulators talking about how they should work together (…again!), or new BFF’s emerging across the supplier base we are all going to have to be nice and get our heads around the fact that collaborating will benefit us all. No one company, solution or service is going to win the day and we will have to work together if we want a sustainable business.
So on that note of good will to all, and in the spirit of the upcoming festive season (yep it’s December so all shackles are off when it comes to festive references) then let’s all wait for the news of the Super fine and look forward to ICE in a couple of months.
Thanks for making it this far through our collective thoughts after SIGMA 2018 !… Why not reach out to us about how we can help with you with customer on-boarding, IDV, KYC and AML.