The US-facing daily fantasy sports industry is about to learn a lesson that other US-facing operators learned long ago; doing business without a payment processor is next to impossible.

Late last week, Vantiv Entertainment Solutions, sent word to Draft Kings and Fan Duel that, as if February 29, it would no longer be handling payments from their US clients.

The announcement comes as a slew of US States have banned daily fantasy sports for their residents. As it stands, about one in four Americans lives in a state where playing daily fantasy sports are illegal.

According to the New York Times, Vantiv  chief transaction and marketing counsel Jonathan Ellman recently wrote a letter to Vantiv DFS clients saying:

As you are aware, an increasing number of state attorneys general have determined that daily fantasy sports (‘D.F.S.’) constitute illegal gambling. Although in recent weeks D.F.S. operators have raised numerous arguments to the contrary, to date those arguments have been unsuccessful and/or rejected.

Ellman’s letter sends a clear message to the daily fantasy sports business that that its counterparts in the payment processing industry are not interested in being part of a grand experiment. They know from experience that American lawmakers are deadly serious when it comes to dealing with the online gambling industry.

The big question now is whether or not other payment processors, particularly PayPal, will follow Vantiv’s lead? As of this writing, PayPal is still on board with DFS, but there’s no telling how long the relationship will last.

Regardless of what PayPal does, it’s clear that things just keep getting worse and worse for the US-facing daily fantasy sports business.


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