Main payment complexities for American sweepstakes operators unveiled
A new boom in sweepstakes products emerged at the end of 2024 and lasted throughout 2025. But with the arrival of 2026, many are starting to worry: is it still worth launching a new project in this field?
States across the U.S. are introducing various restrictions on sweepstakes operations, attempting to preserve the licensed gambling industry. Banks and payment systems are responding by tightening their policies. Additionally, launching a sweepstakes casino requires significant budgets, and the regulatory environment here is not just “on paper” (as is often the case in offshore jurisdictions) but in practice, constantly affecting daily operations. Reacting to a new state’s block is immediate and risks your business. Budgets are growing, and easy profits are becoming questionable; quality projects and long-term work are needed.
How are payment systems performing in this environment?
Today, we’ll explore the main challenges in the payment sector for sweepstakes projects in the U.S. market as per our experience.
Regulations and Restrictions for Operators
Despite sweepstakes projects being legal in the U.S., their operations are strictly regulated. Simply coming up with an extraordinal sweepstakes brand and operating — will not won’t work. You need to adhere to the rules and build mechanics precisely according to them.
The primary aspect of compliance with local legislation is adhering to the principle of free access to the site (which we’ve discussed in more detail earlier) and operating exclusively in permitted states. Although federal law classifies this type of entertainment separately from online casinos and allows it, each state has the right to independently manage such projects within its territory. To ensure product safety, you’ll need to undergo an external audit; without it, payment providers won’t be willing to connect startups.
A robust system for preventing unauthorized access by players from prohibited states and verifying participants' ages plays a foundational role in the project’s success. This is why using White Label options here negatively impacts adaptability if the main software creator isn’t oriented toward the U.S. market and doesn’t adhere to all these rules by default. Your own platform and team will help you stay flexible and take responsibility for all aspects independently. This is already half the battle and ensures the safety of the project and its owners.
Complex and Lengthy Compliance in PSPs
As a result of significant regulatory pressure, connecting a payment provider to your website becomes somewhat more complicated. PSPs need time to verify the merchant and confirm their compliance with current regulations in banking and AML.
The requirements for merchants in the sweepstakes industry number in the dozens and can delay the integration process. Not all of them are documentary or technical — some also relate to business structure, beneficiaries, and office locations. To avoid confusion, it’s important to have support of quality local lawyers and payment experts focused on this market, who can initially build the right structure. Otherwise, if the project is launched without experience specifically in the U.S., you may face additional costs and obstacles even before starting operations. And starting from scratch afterward may not be possible.
Payment systems also operate in an environment where their work is controlled, but on the other hand, the quality of their payment services is much higher than what offshore setups can offer (due to access to legacy banks and direct acquiring). Products will have access to most popular payment methods, particularly card brands like Visa, Mastercard, Amex, and others.
Card Payment Approval Rates in the U.S.
A separate challenge is maintaining payment approvals at the proper level, especially for businesspeople accustomed to working in Europe. The payment industry in the U.S. may seem outdated and inflexible; the high level of card fraud in the country still thrives (United States is one of the jurisdictions that can be called a top target for fraudsters), and banks have a contentious relationship with 3DS mechanisms.
All these factors introduce new challenges for merchants, who must skillfully navigate them and achieve high payment approval rates. Additionally, they need to focus on anti-fraud measures, as being flagged by Visa or Mastercard’s fraud control programs is a real and not illusory risk. Exceeding normal chargeback and fraud rates can lead to a complete disconnection from payment processing, which was not easy to obtain initially and may be even harder to regain in the future. The “sanctions” program from payment schemes is quite harsh, and in addition to significant fines, merchants’ risk being excluded from online processing altogether. In the most extreme cases, repeat offenders may never again gain access to accepting Visa and Mastercard cards, regardless of the payment provider.
High risks have always characterized gambling as an industry, but while they are somewhat lower in offshore setups, legal operations in the U.S. are a more serious game. Operators must adhere to all rules and recommendations from payment systems, comply with personal data processing standards, ensure the security of data storage, and undergo external audits. This involves additional costs and complicated workflows.
Despite all these challenges, the U.S. market remains highly sought after, as it offers a broad and engaged audience, advanced users of services ready for experiments and large deposits. United States shows significant year-over-year growth not only in this industry but also in retail and other online projects. Although the market may seem overheated, new quality projects continue to find their consumers.
Monoup team has already helped launch several successful products in this market and is ready to assist you as well: payment infrastructure strategy, PSP connection, compliance, and our expertise in high-risk will lay the foundation for your future operations. Contact us by email or leave a request in the form below to discuss the details of your project!
