Legal opinion
A current opinion from gaming counsel covering your games and the states you serve.
Payments High-risk industries Skill gaming
HIGH-RISK GUIDE / SKILL GAMING AND SWEEPSTAKES
Skill gaming and sweepstakes processing.
Card processing for skill-gaming and sweepstakes platforms now depends on state-by-state legality and geo-controls. Several states have reportedly acted against online sweepstakes casino models, but status changes often and depends on the product, so each jurisdiction and product requires legal review. Processors approve platforms that can prove a skill-based model with a legal opinion, block restricted states at sign-up and payment, and verify age and identity.
WHY IT IS HIGH RISK
Why processors flag skill-gaming businesses.
- Legal status turns on whether outcomes depend on skill or chance, which varies by state and game.
- State bans have spread quickly since 2025, creating sudden compliance exposure.
- Deposits and prizes look like gambling flows to card networks and banks.
- Account takeover, bonus abuse and friendly fraud drive dispute rates.
WHAT UNDERWRITERS REVIEW
What an underwriter will ask you for.
Geo and age controls
How you block restricted states and verify age at sign-up and at each deposit.
Prize and redemption flows
How players fund accounts, win prizes and redeem, including any dual-currency model.
Fraud and disputes
KYC vendor, device fingerprinting, velocity limits and dispute history.
RULES THAT APPLY NOW
Why state-by-state legal review comes first.
| Date / state | What happens |
|---|---|
| Reported state activity | Secondary sources describe enacted and pending state measures against online sweepstakes casino models (California AB 831 is one reported example). This list is not exhaustive or verified as current. |
| What to do | Have gaming counsel review each jurisdiction you serve and each product you offer before launch or expansion. |
Washington has long treated online sweepstakes casinos as prohibited. Bans target online sweepstakes casino models specifically; true skill-based contests may be treated differently, which is why processors want a game-by-game legal opinion. Rebar does not maintain a verified current list of state bans; each jurisdiction and product requires legal review before launch or expansion.
CARD-NETWORK RULES / CURRENT AS OF OCT 2026
Card-network thresholds every high-risk merchant should track.
Most processors act well before these limits. Track your own ratios weekly.
| Program | What triggers it | What it means for you |
|---|---|---|
| Visa VAMP (merchant "Excessive") | From April 1, 2026 in Asia Pacific, Canada, Europe and the US: a VAMP ratio of 150 basis points (1.5%) or higher AND at least 1,500 fraud plus dispute counts in the month. The VAMP ratio is fraud reports (TC40) plus disputes (TC15) divided by settled card-not-present transactions, by count. It is not a simple chargeback ratio. Other regions and earlier periods differ. | Per-event fees once enforced, a remediation plan, and pressure from your acquirer to fix it or exit. |
| Mastercard ECP: Excessive Chargeback Merchant | Chargeback ratio of 1.5% or higher and at least 100 chargebacks in a month, in two months (not necessarily consecutive). Ratio = this month's chargebacks ÷ last month's transactions. | Monthly fines that escalate from $1,000 in month two to $25,000 by month seven. |
| Mastercard ECP: High Excessive | Chargeback ratio of 3% or higher and at least 300 chargebacks. | Fines that escalate to $50,000 a month by month seven and $200,000 after month 19. |
| MATCH list (Mastercard) | Your acquirer terminates the account for a listed reason, such as excessive chargebacks, fraud or rule violations. | The listing stays for five years and most acquirers will decline a listed business or principal. |
WHAT TO EXPECT
Terms high-risk merchants are commonly offered.
Owner-confirmed Rebar field observations. These ranges are not guaranteed and are not quotes; every offer depends on the provider's underwriting and your file.
| Term | What it usually looks like | How to improve it |
|---|---|---|
| Rolling reserve | A share of each day's volume held for a set period. Owner-confirmed Rebar field observation: new high-risk accounts commonly see 5% to 10% held for 90 to 180 days. Not guaranteed; depends on underwriting. | Ask for a written step-down schedule tied to clean processing history. |
| Pricing | Higher markups than standard merchants. Interchange-plus pricing becomes available as volume and history grow. | Compare effective rate, not headline rate. Use our statement analyzer. |
| Volume caps | A monthly processing limit, often set below your forecast for the first months. | Bring 3 to 6 months of statements to support a higher cap. |
| Contract terms | Early-termination fees and, sometimes, liquidated damages. | Read the termination and reserve-release clauses before you sign. |
AVOID THESE
What gets skill-gaming accounts frozen or closed.
- Accepting players or payments from a state that has banned your model.
- Games that a regulator or the acquirer views as chance-based.
- Weak age verification or underage players.
- Bonus abuse and friendly fraud pushing dispute ratios over network thresholds.
- Changing your prize model without telling the processor.
READINESS CHECKLIST
Get underwriting-ready in 7 steps.
- 01
Get, or refresh, a legal opinion covering every game and every state you serve.
- 02
Block banned states at registration and payment using IP, device and billing-address checks.
- 03
Verify age and identity before the first deposit.
- 04
Document prize, redemption and dual-currency flows for underwriting.
- 05
Set deposit velocity limits and monitor bonus abuse.
- 06
Use descriptors and receipts players recognize to reduce friendly fraud.
- 07
Keep a second processor approved for redundancy.
QUESTIONS
Skill gaming processing questions, answered.
Which states have banned sweepstakes casinos?
Several states have reportedly enacted or proposed measures against online sweepstakes casino models, and status changes frequently. This page does not provide a complete or verified current list. Each jurisdiction and product requires legal review by gaming counsel.
Can a skill-gaming platform accept credit cards?
Yes, with a specialty acquirer that supports the model. Expect to provide a legal opinion, prove geo-blocking and age verification, and accept a reserve. Some platforms also use alternative payment methods alongside cards.
What is the difference between skill gaming and sweepstakes casinos for processors?
Processors care about whether outcomes depend predominantly on skill or chance and whether the state allows the model. Sweepstakes casinos that mimic casino games are the main target of recent bans. Skill-based tournaments are evaluated separately, game by game.
Why do skill-gaming merchants get high chargebacks?
Friendly fraud (players disputing deposits after losing), account takeover and bonus abuse. Strong identity verification, clear descriptors and fast refunds on genuine errors keep ratios down.
NO REBAR ADVISORY FEES
Get a free pre-underwriting review for your skill-gaming business.
Tell us where you stand. We will flag what an underwriter is likely to question and suggest suitable processing options. Rebar charges no advisory fee; provider fees and terms apply.
SOURCES AND REVIEW
Where these facts come from.
These summaries come from the provided source dataset listed below and have not been independently verified by Rebar. Rules and enforcement change. We review this page at least quarterly and date every update. Confirm current requirements with your acquirer, card network rules and counsel before acting.
- Sweepstakes casino bans 2026: state status (DeucesCracked, May 7, 2026) · Enacted bans, effective dates and pending bills
- Gov. Newsom signs California online sweepstakes ban (SBC Americas, Oct 2025) · AB 831
- Visa Acquirer Monitoring Program fact sheet (Visa, 2025) · Primary source: merchant Excessive threshold of 150 bps from Apr 1, 2026 in AP, Canada, Europe and US, with at least 1,500 monthly fraud plus dispute counts; ratio uses settled card-not-present transactions
- Visa VAMP rules explained 2026 (Easy Pay Direct) · VAMP ratio method; 2.2% merchant threshold through Mar 31, 2026, 1.5% from Apr 1, 2026
- Mastercard Excessive Chargeback Program (Chargeflow) · ECM and HECM thresholds and fine schedule, citing Mastercard's ECP guide