The Sims working on a PC.

Why a B2B Gaming Licence Is Important for Game Developers

The global online gambling industry is facing increasing pressure for regulation and licensing, with gambling providers now being held responsible for the actions of their affiliates. This regulatory scrutiny is prompting operators to seek guarantees from their third-party suppliers, as they do not want to be associated with companies that can potentially harm their reputation.

Moreover, the payments made to and from these suppliers can pose money laundering concerns for the operator’s compliance team if the B2B partner has unsavoury elements. Therefore, software providers are now feeling the need to demonstrate a seal of quality for their services.

Game developers, software providers, re-sellers, distributors, and are seeking licenses that can show their commitment to keeping crime out of gambling and meeting international commitments and obligations to organizations such as OECD and FATF. While obtaining a license may not be mandatory in every market, it is essential to demonstrate compliance with international standards for CFT and AML.

Having a reputable license can make all the difference to an operator in deciding which suppliers to partner with and to an investor in choosing which company to invest in. It also provides other benefits, including better relationships with banks, opening doors to more partnerships, and even M&A activity.

Ultimate transparency and improved trust

Acquiring a credible license in the gaming industry serves as evidence that game developers adhere to the highest standards of corporate governance. The licensing process enables developers to demonstrate transparency, honesty, and ethical conduct in their operations. This applies to game aggregators, platform providers, token/crypto solution providers, distributors, and re-sellers as well. It is crucial for developers to ensure that third-party entities promoting their games are legitimate, transparent, and operating within the confines of the law. Ultimately, securing a top-tier license serves as the most reliable means of demonstrating to operators that the software provider is a reputable entity that places a high value on compliance.

This is also true for operators and clients. When an operator, such as, becomes regulated and licenced, it is a proof that they are trustworthy and reliable.

Reassurance for banks and financial institutions

There are global concerns surrounding banks refusing to process transactions from online gambling businesses, largely due to the industry’s emerging nature, particularly in the UK. However, education will help address this issue over time. Game developers can also play a role in improving this situation, both in the UK and other markets, by acquiring a license from a reputable jurisdiction and subjecting themselves to the same level of scrutiny as operators. This applies not only to emerging markets but also to established jurisdictions where banks and payment providers require reassurance. In grey markets, it is especially crucial to ensure that partners do not damage the developer’s reputation, particularly in regard to anti-money laundering and fraud. Obtaining a software supplier license is one of the most effective ways to demonstrate that a developer’s structure and product have undergone scrutiny and pose no threat to AML/CFT concerns.

Increased exposure and improved sales

Acquiring a software supplier license can be a beneficial move for game developers to expand their reach and boost sales. For instance, obtaining a B2B Software Supplier License in the Isle of Man qualifies approved game developers to be included in a register of vendors. This list is accessible to operator licensees through the Gambling Supervision Commission (GSC) website, enabling them to select game providers to collaborate with. This register of products serves as a tool for business development, indicating which products have received the Isle of Man regulator’s endorsement.

To be included on this list, the game designer must submit its testing certificates and go through the regulator’s due diligence procedures. Products on the list can be seamlessly integrated into any IOM licensee’s portfolio without the operator requiring additional testing certification. This eliminates the need for operators to produce a certain certification for a new slot game or any third-party product. Furthermore, gambling providers can refer to the register to identify products they can deploy immediately, reducing the time it takes to integrate products into their portfolio. As a result, this streamlined process can help increase sales for software developers.

It’s good for M&A Activities

Mergers and acquisitions are an integral part of the dynamic global online gambling industry, particularly for software suppliers. For game developers seeking funding or intending to sell their business, obtaining a software supplier license is one way to assure potential buyers or investors of the company’s credibility. This applies similarly to software suppliers seeking to list on renowned stock exchanges like the London Stock Exchange, AIM, or NASDAQ.

While game developers may not need to apply for and secure a license to provide their products to operators in every market, there are considerable benefits to acquiring such permits, particularly for those looking to establish a sustainable and prosperous business. In addition, as regulations continue to evolve in all aspects of the global online gambling industry, software suppliers should prioritize meeting the standards demanded and expected by their B2B customers.