PayPal Back in the Online Gambling Business

With no fanfare whatsoever, payment processing giant PayPal has gotten back into the online gambling market in the United States. Just last week, though, PayPal has quietly shown up on the sites of a few gaming providers as a valid option for funding accounts.

One such site is, which has two separate online poker rooms, one in Nevada and one in New Jersey. has instructions in its “Help” section about how to make a PayPal deposit, complete with screen shots. It does not appear that there are any fees to make PayPal deposits or withdrawals on, but there could be fees to cashout from a PayPal account to a bank account. is even offering customers a ten dollar tournament ticket when depositing $100 or more via PayPal by September 30th.

PayPal used to be one of the biggest e-wallets in the online gambling industry until it was acquired by eBay for $1.5 billion in 2002. The corporate combination made sense for PayPal, as getting onboard with the online auction company assured it a heck of a lot of business. But when PayPal and eBay become one, PayPal stopped processing online gambling transactions.

Now that the two companies have separated, though, PayPal is back in the gambling business. Interestingly, though, the payment processor has not had any sort of marketing blitz or really even put out so much of a press release about the move. In a statement to CNBC, PayPal said:

PayPal is launching a pilot program to support four leading real money gaming (RMG) operators to offer PayPal as a way for gamers to fund their online accounts with these merchants. We are launching this pilot now that we are able to fully comply with the evolving laws surrounding RMG in the United States as well as the requirements of our payment partners. As a global payments provider, PayPal’s goal is to give people safe and simple ways to pay for the things they want, so long as we can comply with applicable laws.

PayPal’s policies still prohibit using the service for online gambling, but only if the operator has not been approved by PayPal. While it was a bit of a surprise to suddenly see accepting PayPal, all of the major daily fantasy sports (DFS) sites have been accepting PayPal for quite some time. FanDuel told CNBC that half of the site’s transactions run through PayPal.

The question remains, though: why is this almost a clandestine operation by PayPal? Professional poker player Andy Frankenberger, who was once a Wall Street trader, told CNBC, “My thinking is PayPal may not want attention is because there is a perception that online gaming is a gray area.”

“Perhaps PayPal doesn’t want to jeopardize their market status in states that oppose online gaming,” he added.

In this writer’s opinion, though, that’s probably not it. After all, while PayPal has been quiet about it, its entry back into internet gambling isn’t ACTUALLY a secret. readily displays PayPal as a deposit option – customers don’t need to go to a secret URL on the Dark Web or anything to use the payment option. Same goes for, a start-up online casino and horse race betting site. The DFS operators have been invading our eyes and ears with advertisements and they display the PayPal logo on their sites.

If PayPal was nervous about attracting unwanted attention from states that oppose online gambling, then it would not have hopped back into the industry. And besides, it doesn’t matter what other states think. As long as PayPal is obeying the laws in the states in which it permitting the online gambling transactions, everything will be fine. A Utah isn’t going to prohibit PayPal from processing eBay transactions just because it processes deposits in Nevada.

A spokesperson for PayPal told that its rollout with four online gambling operators is a “limited test.” That’s probably the reason for the lack of fanfare. It is basically just a soft launch right now; PayPal is just testing it all out. There is no reason for it to start contacting every media outlet to trumpet an endeavor that might not even end up to be a long-term thing. Sure, if PayPal was trying to launch a rocket and then have it land upright, it might want to get a few cameras out there since succeed or fail, it’s pretty spectacular. But even though SpaceX’s founder and CEO, Elon Musk, also founded PayPal, processing gambling payments is not rocket science. A limited run test does not necessitate a promotional campaign.


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