As online gambling operators face increased accountability for their affiliates and potential responsibility for third-party ad servers, the global online gambling sector experiences growing demands for regulation and licensing.
Consequently, operators are seeking assurance from third-party suppliers they collaborate with due to increasing regulatory scrutiny. It is crucial for a reputable operator to avoid associations with companies that could tarnish their reputation. A B2B partner with unsavory elements could contaminate funds and raise anti-money laundering (AML) concerns for compliance teams.
This has led to a rising need for software providers and their distributors in the industry to showcase a mark of quality for their company and services.
An increasing number of progressive game developers, distributors, re-sellers, and software providers are searching for a license that represents a strong commitment to preventing crime in gambling, adhering to international obligations, and collaborating with organizations like the OECD and FATF.
Although not always legally required for game developers and distributors in every market, obtaining a license is becoming increasingly crucial to demonstrate compliance with international AML and CFT standards. No one wants to jeopardize their reputation through B2B relationships with disreputable companies.
As respected license, an Isle of Man B2B License indicates adherence to high levels of corporate governance, can make a significant difference when operators select suppliers to partner with or when investors choose companies to invest in.
Additional benefits of game developer and distributor licensing include improved banking relationships, increased partnership opportunities, and potential M&A activity.
Here, we delve into some key advantages in greater detail:
Enhanced transparency and trust
By obtaining a reputable license, game developers can demonstrate their adherence to the highest standards of corporate governance.
Submitting to the licensing process allows them to prove their transparency, integrity, and legality.
This also applies to game aggregators, platform providers, token/crypto solution providers, and distributors/re-sellers – developers must ensure that third parties promoting their games are legitimate, transparent, and operating legally.
In essence, acquiring a top-tier license is the most effective method of proving to operators that a software supplier is highly reputable and equally committed to compliance.
Globally, banks often refuse to process transactions from online gambling businesses.
While this issue should improve over time through education and industry development, game developers can help by obtaining a license from a reputable jurisdiction and subjecting themselves to the same scrutiny as operators.
In both established and grey markets, banks and payment providers require reassurance, making it crucial for partners to maintain a good reputation.
One of the best ways to achieve this is by obtaining a software supplier license that demonstrates thorough scrutiny and minimal exposure to AML/CFT concerns.
Greater exposure and increased sales
A software supplier license can help game developers expand their exposure and boost sales.
For instance, the Isle of Man’s B2B Software Supplier License adds approved game developers to a vendor register.
Operator licensees can access this list via the Gambling Supervision Commission (GSC) website and choose game providers to collaborate with.
This product registry serves as a business development tool, showcasing products with the Isle of Man regulator’s approval. To join the list, game developers must provide testing certificates and undergo the regulator’s due diligence procedures. Products on the register can be integrated with any IOM licensee without needing a testing certificate.
This significantly reduces the time required for operators to incorporate products into their portfolios, which can lead to increased sales for software providers.
A foundation for M&A
Mergers and acquisitions are integral to the excitement of the global online gambling industry, particularly for software suppliers.
For game developers seeking to sell or secure funding, acquiring a software supplier license can reassure potential buyers or investors of the business’s reputability.
The same applies to software suppliers planning to list on stock exchanges such as the London Stock Exchange, AIM, or NASDAQ.
In conclusion, while game developers may not need to apply for and obtain a license to offer their products to operators in every market, there are significant advantages to securing such permits. Those aiming to establish a sustainable and successful business should seriously consider this.
As regulation continues to impact all facets of the global online gambling industry, it is essential for software suppliers to meet the standards expected and required by their B2B customers.
Find out how SolutionsHub could assist with your Isle of Man B2B License.