The Swedish Gaming Authority has given Zimpler an ultimatum which could be followed by a SEK25 million fine.
When it comes to being in the spotlight, it can be for various reasons, both good and bad. Unfortunately, Zimpler seems to have found itself in hot water, making headlines with its latest mishap.
The payment provider has been given an ultimatum from the Swedish Gaming Authority , which, should they not comply, can lead to a massive fine.
Comply or be fined
Zimpler received a warning from the Swedish regulator Spelinspektionen if it fails to quit its business with unlicensed operators.
The payment provider has been given time until the 31st of July to stop providing payment services containing BankID to any operator not licensed.
Zimpler is a Swedish mobile payment solution that works solely in conjunction with mobile phone numbers for fast and convenient use.
Should they fail to comply with the ultimatum, they will be issued a fine of SEK25 million (£1.8m/€2.1m/$2.3m).
According to Spelinspektionen, the Swedish gambling regulations are created so that all those who operate within the market must have a license, and unlicensed sites must be completely cut off. The objective is to ensure that all gambling activities take place on reliable and responsible casino sites under regulatory control.
The gaming authority states that since the beginning of January, there has been a ban on promoting participation in games on sites without the necessary licensing .
The Big No Go
According to Spelinspektionen, the reason they decided to act against Zimpler is due to their use of BankID in transactions via unlicensed operators.
What is BankID? It is an e-identification service that is currently only used by Swedish customers.
The use of BankID during transactions made it possible to identify these operators illegally catering to Swedish players . While no site identity has been revealed, the gaming authority has started an investigation thanks to an anonymous tip.
Zimpler makes its case
According to the payment provider, it doesn’t believe its actions breach Swedish laws. That being said, Zimpler has already agreed to terminate its relationship with any unlicensed sites catering to Swedish players.
The payment provider has already started the process of ending these relationships and hopes to cut all ties by the third quarter. Zimpler also stated that they did not know about operators not carrying the necessary licensing. The overall assessment concludes that sites are designed to cater to Swedish casino players.
On top of that, none of the operators were on the Spelinspektionen list of illegal brands catering to the Swedish market.
The payment provider went on to say that the payment service solutions Zimpler providers are not specifically aimed or adapted for gaming companies but for customers across all segments. And as such, the payment service solution must be considered as a normal payment task .
In general, Zimpler has strict measures in place to ensure regulatory compliance . This also gives them the right to terminate business relationships whenever something shows illegal activity, such as targeting Swedish customers without the necessary licensing.
Spelinspektionen bounced back, saying that the close collaboration between Zimpler and the illegal operators is evident . These sites use Zimpler’s payment service solutions illegally in the market, while Zimpler promotes unlicensed activity.
The fight against illegal gaming activity
According to a report by Sweden’s Online Gaming Industry Association (BOS), the statistics show 77% of the Swedish online gaming market is channelised. According to BOS, it is critically low, and as such, action must be taken. The goal for channelisation is currently set at 90%.
With the serious concerns surrounding illegal gaming activity, the Swedish government has awarded Spelinspektionen a new set of measures .
These focus primarily on payment providers and the power the gaming authority has within this area . It is expected that all providers submit the required information to the authority.
With these new changes, there is allowance for a more efficient system to block payments. This also spearheads the battle against unlicensed gambling activity.