Cash Is King : Prepaid Cards Set To Takeover

In the gaming world, cash delivery is king. Perhaps also the queen, emperor and ruler.

Winners in this multibillion-dollar, breathtakingly fast business are those who can produce funding mechanisms faster than players can snap their fingers for money. Suppliers provide upgraded kiosks, ATMs and mobile apps, which in turn enable credit cards, checks and bank cards to spill money or vouchers into the player’s hand. Or onto a game.

Table devices have even emerged to let players change games, cashless, without missing a beat. Any supplier able to reduce player down time and spike casino revenue earns a seat at the table of riches.

Companies angling for this market must think outside the box. Sightline, built by former Global Cash Access executives, unveiled a card backed by a bank, a credit-card company, a gaming giant and a processing kingpin. It is used in conjunction with casino loyalty cards.

While the Las Vegas companies enhance their niche, Toronto-based NRT champions kiosks. Its cashless theme spans several areas: the machines it uses with Sightline, the imminent off-site breakthrough in Las Vegas sports betting and a new currency-conversion mechanism which debuted in Connecticut in March.

All of the companies played to their strengths. Sightline and NRT found a link in the gaming chain and attached their innovation to it.

Companies invested millions, on spec, and hoped they were right.

For them, so far so good.

Clear InSight

Las Vegas-based Sightline provides turn-key and licensed payment solutions to various players in the gaming world.

The company is aptly named, for it was a vision that drove five entrepreneurs to launch a bold gamble in 2010. Former GCA executives Kirk Sanford, Tom Sears, Harry Hagerty, Diran Kludjian and Omer Sattar teamed up at Sightline and found a new idea.

For the last two and a half years, they have invested millions to bring a product into gambling’s extended sphere.

Success looks to be in the cards. Or, make that, the card.

Online gaming’s new floodgates create a colossal opportunity for their Loyalty Card Plus Discover Prepaid Card. The product is the same as a casino’s loyalty card, and gives players the chance to access their prepaid account through the closed-loop proprietary Sightline network, SPAN. That network allows them to transfer funds in real time to and from a slot system, table games, race and sports book or online casino.

Sattar estimates there are 37 million casino reward cards available for conversion into a prepaid card. In the past year, his company assembled several essential teammates to go after them. Sightline obtained the backing of Sutton Bank, which issues the cards; Discover, the card network; Vantiv, which processes billions of transactions; and slot manufacturer Bally Technologies, for the brick-and-mortar and online gaming platform. For good measure, Sightline added NRT’s worldwide kiosk clout.

“We put our own butts on the line, so it is very exciting to see this happening now,” says Sattar, one of leaders behind the company’s card effort. “When you consider that New Jersey, Delaware and Nevada allow online gaming, what about the next step? We are watching California closely. That’s 40 million-50 million people. We are moving the gaming industry forward, and much of the success has finally happened in the past few months.

“We’re in a small business here, and your reputation is your gold. We didn’t want to be known as someone who sells vapor-ware (a product that exists more in concept than reality). We were able to gain some major companies willing to make a big bet on us, and we consider that thrilling.”

How does it work? Customers can pre-fund the accounts online, through their mobile phone or load funds at the casino with cash, jackpot payouts and other ways, including TITO tickets. The funds act as a bank account, with FDIC protection. Players are, in effect, drawing from their own loyalty card when they tap funds either to play or spend money elsewhere.

Because of the card’s link to Discover, they can also increase their spending flexibility.

“You can be sitting at home, using a mobile app now legal in Nevada,” Sattar says. “You have the money on deposit with a casino, and let’s say you placed a bet for $100 and you have won $500. Using the mobile app, you can cash out in real time, or deposit the money into the online gaming account.

“Now, you want to take your wife out to dinner. You can do it with the funds on your pre-paid card. Or you can buy something on or go to Home Depot. The most important thing is that you have access to your money at all times. You also can go to any ATM in the country to cash out.

“The advantage for the customer is that the casino is not holding their money all the time.”

That’s an edge for the casino, too. Sattar says a casino that needs to have $300 million-$500 million available in its machines now has the advantage of putting that money directly to work. If fewer funds are needed to be part of the games, the property can take a percentage of it to pay down debt. That would in turn increase a company’s earnings per share by 10-15 percent, he estimates.

“Everybody wins,” he says. “If you don’t do something that’s good for the customer, the customer won’t be part of it. If you can’t do something the casino can profit by, they won’t sell it for you.”

Casinos profit beyond the art of “untrapping” millions of dollars. Unlike many technological advancements, this one costs nothing.

“All you have to do is say yes,” Sattar asserts. “There is no hardware, absolutely nothing for you to buy.”

Sightline’s partnerships are prominent. Vantiv is a leading integrated payment processor differentiated by a single, proprietary technology platform. It offers a suite of traditional and innovative payment processing and technology solutions to merchants and financial institutions in the U.S., enabling them to address their payment processing needs through a single provider.


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