Paving the Way for an Increasingly Cashless Future

The Canadian Gaming Association’s regulatory Standards for Cashless Systems are the result of an industry-wide discussion about where gaming is headed.

By Tom Nightingale

Given the large extent to which all corners of the Canadian gaming industry have been affected by COVID-19 in the last 14 months, it’s easy to forget that certain trends were seen before the onset of the pandemic.

One of the major shifts in casino gaming is the move towards an increasingly cashless way of operating.

It’s a change that has been brought on by many things: similar technological movements in other industries, consumer demand for more flexibility in the way they gamble, and the new challenges brought on by a worldwide virus and extensive shutdowns.

Identifying what was needed

For the Canadian Gaming Association (CGA), it was already a priority. The CGA established a Regulatory Innovation Committee in 2019 to help the gaming industry identify and develop innovations for the sector in Canada. The Committee, consisting of a range of operators and regulators from across the country, recognized “cashless wagering systems” as a potential modernization which could enhance the customer’s experiences in land-based facilities. As President and CEO Paul Burns explains, the creation of the standards came about thanks to the realization that consumer purchases were largely cashless, and that the industry would benefit from a common approach to do the same.

“The fact is there’s a generational swing in terms of people carrying cash,” Burns explains. “We saw this was coming and as an industry, we should be able to get ahead of these trends and understand how we’re going to adopt them when they come.”

Approaching it in the right way was important. The CGA is a collaborative organization and sought the input and feedback of the industry. That committee includes a wide cross-section of gaming industry representatives working with provincial gaming regulators and subject matter experts. It’s a treasure trove of expertise and insight, encompassing all ends of the spectrum of personnel who would be best placed to affect significant developments in the industry.

Terry McInally, Chief Compliance and Information Officer for Gateway Casinos & Entertainment, stresses that this variety in committee participants is an important factor in producing standards that will stand up to scrutiny and light the path forward. “We’re not navel-gazing; it’s not a bunch of operators or a bunch of manufacturers looking at this, everybody brings the good and the bad into the discussion. You have regulators bringing their point of view into the dialogue, operators explaining where it works and where it will be challenged. It’s imperative to have that type of broad, nationwide group.”

Collaboration was key

McInally was just one of the many experts on the committee. He is appreciative of the committee’s efforts when discussing the straight path that the CGA followed. He cites the committee as a hugely productive tool for ensuring the achievement of industry goals and cooperation between all participants.

“There’s always open dialogue, it’s very transparent,” McInally says. “We all reviewed the material, the draft standards were formed, and we then go through multiple iterations of discussion, comments, feedback to get to a point where we have agreement on how they should and would be structured. There’s no stone left unturned by the time we get to the final product.”

The CGA put out the draft standards for industry comment in the late spring of 2020 to obtain feedback and suggestions. Those discussions were key, emphasizes Burns. “We wanted to understand the industry’s rationale when it came to where technology is going to take us. We held consultations with the responsible gaming community, with FINTRAC, and so forth to ensure the standards reflect the latest regulations and give operators the flexibility to implement technology as quickly but also as responsibly and safely as they can.”

As the process continued, the CGA and the committee watched keenly as Nevada and other U.S. jurisdictions started to adopt their own cashless frameworks. “We saw then that (cashless wagering) was going to be expedited,” says Burns.

High praise

Ultimately, the industry has ended up with a thorough and complete framework for implementing cashless wagering in Canada.

The standards – and the way in which the CGA went about achieving them – are getting glowing reviews from industry leaders who participated in the process.

Darren Simmons, Executive Vice President and FinTech Business Leader at Everi, was a co-chair of the Regulatory Innovation Committee for this project. He stresses that one of his company’s primary focuses has been trying to educate customers on what cashless actually means and the implications of the pivot. He praises the standards as an excellent foundation for operators to work from. “Having some base for the regulators and operators to understand the actual meaning and implications of cashless wagering is so important,” Simmons says.

Ryan Reddy, Vice President of VLT, Systems, and Payments Products at IGT, was glowing in his assessment of the process. “What we really appreciate about the Canadian marketplace is that it tends to be a very pragmatic and collaborative environment,” Reddy acknowledges. “The transparency in developing the standards, and in the finished product, is wonderful. We wanted to make sure we gave uniform and holistic comprehensive responses to the CGA for their guidelines and their framework.”

Stewart Groumoutis, Director of eGaming at the British Columbia Lottery Corporation, emphasizes that the CGA’s standards are all about sharing best practices, from industry personnel learning from each other. “Any sustained endeavour to bring commonality and understanding to both players and operators of what to expect and how to execute effectively should be welcomed. It’s a fantastic initiative.”

Burns, for his part, voices his gratitude for the number of people who took part in the development, and the deep consideration they gave to it. “The willingness of so many amazing people to contribute was tremendous and it’s produced a really great piece of work. The project was overwhelmingly well-received. We saw from everyone that appreciation of the thoroughness completeness of the document and the proactiveness of the committee.”

The standards were built upon work done in the industry at large but Burns stresses the “Canadianization” of the document was important. “It’s exciting to think what more we can do with this group in future projects.”

Driven by consumer demand  

The standards are now available for implementation across Canada. Their goal is to eliminate subjective criteria when analyzing and certifying cashless systems and provide a baseline of commonality across the provinces. In addition, to introduce cashless wagering fairly, securely, and in a way that is properly regulated. Jurisdictions in Canada now have a basis from which they can build their own regulatory standards or adopt the committee’s framework.

Burns says the standards are there to serve as a tool for regulators, operators, and technology providers to be able to better tailor products to the Canadian market. At a time when everyone in the industry is seriously challenged when it comes to costs and resources given the impact of the pandemic, the aim is to help the industry thrive and move forward. “The past year has shown that we as an industry need to look at the ways we do business and be more innovative. This contributes hugely to that (goal).”

The undeniable fact is that the world is moving increasingly towards cashless operation across a range of industries. In an increasingly technological world, the gaming industry had to keep up.

“Cashless wagering has relevance outside gaming as well,” says McInally. He adds that he provided information from banking sectors and similar areas to the committee that illustrated clearly where and how this type of technological innovation had started to move forward.

“Consumers are increasingly looking for these options,” Burns continues. “It’s crucial that the industry not be behind the curve when it comes to this demand and educating people that they can adopt these technologies.” Ultimately, he says, it comes down to the fact that being able to offer these tools for alternative payment to cash is very important. “Every business is dealing with this issue.”

All in all, the consensus seems to be that cashless offerings and adoption in the Canadian gaming industry is long overdue.

“Unfortunately, it hasn’t gotten the momentum historically that is should have,” laments Groumoutis. “Now, the reality is the world has changed. In these trying times, when you think about the high-touch environments of casinos and use of cash, we definitely owe it to customers.”

“Terminology changes, requirements change, so having a standard is critical for moving forward,” says Simmons. “In layered marketplaces like Canada, there’s certainly a mounting demand. You have to respond to the fact that people want technology, but you have to also balance that with what regulators and operators are trying to provide to their customers.”

The pandemic accelerant

The desire from consumers to see more cashless technology implemented has been a pre-existing driver for change, but one thing COVID-19 has done is bring other factors into the equation. Against the backdrop of the pandemic, McInally emphasizes that things have changed unpredictably and potentially irreversibly.

“I think now the consumer has a heightened awareness of the cashless issue,” McInally says. “It can’t go unnoticed that COVID-19 has caused many people to not want to touch cash in the same way; they’ve got so accustomed to tapping a credit card that these types of options just have become second nature. In many aspects, we will never go back again in that regard. They’ve had extensive exposure of this across many environments, from gaming to online shopping. There’s also the convenience aspect: with the increasing advent of digital wallets and all-in-one solutions, cash can get in the way. These standards give our industry the wide ability to start to talk through the technological options available, see how these would work in different environments, and refine how we engage customers properly to inform and educate them on how they can use this technology.”

Safety, too, is an increasing concern, with all operators focusing on infection prevention and control. Customer demand for more contactless experiences has increased as people look for safer ways to transact purchases, and the standards will provide a method for digital transactions which significantly diminishes the need for customers and employees to physically touch areas and items, enabling a healthier and safer operating environment. What was already a pressing issue has become an even more substantial point of discussion and progress for the industry.

Moving forward together

That’s not to say that cash will disappear overnight.

For many customers, particularly older generations, the feeling of cash is a comfort, a familiarity that they will not want to abandon. Not everyone will naturally gravitate to the shift to cashless, but what is important is that those options are available, visible, and controllable with the CGA’s Standards for Cashless Systems.

“I think cash will always have a place in every business, including gaming,” says Burns. “But being able to give consumers wide options and tools is important. We’re an industry driven by excellent customer service so being able to provide the customer with what they want when they want is vital. That’s really why it was such a priority for us.”
Thanks to the CGA and the collaboration of the industry, Canada now has a thorough, responsible, set of standards.

It’s an increasingly cashless world, and Canadian gaming is keeping pace.

A copy of the Standards for Cashless Systems can be downloaded on the CGA’s website.

This story originally appeared in the Spring 2021 issue of CGB magazine.

CGB thanks Terry McInally, Darren Simmons, Ryan Reddy, and Stewart Groumoutis for their contributions.


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