“Trend we’re focusing on is the dynamic changes in open banking”
In another exclusive interview, we have the privilege of speaking with Christian Reinheimer, the Group Director of Payments Product & Technology at LeoVegas Group, who stands at the forefront of digital payment innovations in the iGaming industry. Together we are exploring the multifaceted challenges and cutting-edge advancements that define today’s payment landscape in this dynamic sector.
Can you describe your responsibilities and goals as the Group Director of Payments Product & Technology at LeoVegas Group?
My responsibility is the Payments Product & Technology department, which consists of diverse roles along the value chain of building an internal payments gateway. Our vision is to provide the group with an industry-leading payments gateway, running a highly efficient payments offering to our customers, in our various markets, at low cost.
What is your vision and strategy for providing an industry-leading payment experience for all LeoVegas Group customers?
LeoVegas Group operates multiple brands across various markets, subject to an array of igaming licenses. We aim to merge this environment with customer preferences to create a unique experience for each brand-market combination. While striving to provide our customers with the most comfortable and friction-less experience possible, we also need to prevent potential fraud and money laundering—a challenging balance.
Our approach is rooted in an understanding of payments. We categorize them into groups such as Card, Banking, or eWallet payments, always taking the customer’s perspective into account. Cards, for instance, are provider-agnostic. Our customers don’t have a relationship with our acquirers; they simply have a card issued by their bank and wish to use it regardless of whether we process the transaction through acquirer A or B.
eWallets, conversely, are a different story since customers have a relationship with their eWallet provider and expect to see their chosen provider available in the cashier. eWallets are driven by consumer brand loyalty; we cannot substitute eWallet B for a user of eWallet A and expect them to switch.
For all payment categories, we store details on the payment instrument used—be it the card, bank account, or eWallet account. This is crucial for facilitating the journey of returning customers and for risk mitigation.
Ultimately, we orchestrate payments on three levels: what the customer sees in the cashier, in-category orchestration, and cross-payment-instrument orchestration.
How have digital payment technologies evolved in the iGaming industry during your tenure, and what are the key trends you’re currently focusing on?
First of all, the iGaming industry is in a constant state of evolution. The ongoing developments in local regulations impact our payments offerings, as each licensed market has its own rules and regulations governing payments in iGaming.
Simultaneously, the payments industry is evolving with new trends. In recent years, some solutions have emerged and gained popularity swiftly. The most significant trend we’ve observed is that payment methods which are fast, convenient, and secure quickly capture major market shares, as demonstrated by Swish in Sweden and PIX in Brazil.
We’ve also noticed a decline in the popularity of eWallets and the disappearance of anonymous vouchers in some markets.
A particular trend we’re focusing on is the dynamic changes in open banking. Since the PSD2 directive came into effect in the EU in 2019, there has been a surge in this sector. Bank-based payments, once offered by only a few providers, are now supported by many companies. This competition is beneficial for us, fostering innovation and reducing costs. We anticipate further positive changes from the regulatory enhancements based on the experiences of the past few years, such as the mandate for instant bank transfers.
However, open banking technology offers more than just initiating payments from bank accounts. Open banking APIs can aid us in verifying payment ownership, combating money laundering, and conducting affordability checks. The latter has become increasingly crucial as we continue to commit to responsible gaming. While our industry, like any other, aims to be highly profitable, ensuring customer safety remains paramount.
In what ways do you ensure that the payment experience aligns with customer expectations and needs in the iGaming sector?
We employ various methods to evaluate whether our payment experience satisfies our customers. As a data-driven company, we analyze processing data to inform our decisions. We conduct A/B testing to assess adjustments in our customer journey and utilize questionnaires to understand issues such as customer drop-off points. Additionally, we maintain a close relationship with our operational teams, who gather direct feedback from customers. We also conduct market research and monitor industry trends and developments to ensure we are aware of changes.
We use all these sources of information to continuously enhance our payment experience. Ultimately, we measure our improvement efforts through two high-level metrics: the conversion rate for deposits and the rate of instant pay-outs. Higher success rates in enabling customer payments and providing quick access to winnings correlate with greater customer satisfaction regarding our payment services.
Could you share insights about your experience with Klarna, particularly in online payments, and how it has influenced your work at LeoVegas?
I spent a couple of years at Klarna in various roles. This experience significantly impacted my leadership style and prepared me for an extremely dynamic environment. Klarna was moving very fast and was adept at adjusting quickly to changing circumstances, a trait shared with LeoVegas. Both companies place a strong emphasis on customer focus when developing products.
Seeing the world of online payments from a provider’s perspective, especially from the sales department of a PSP, gave me valuable insights. These insights became particularly useful when I joined LeoVegas and found myself on the receiving end of sales pitches. Having knowledge of the inner workings of PSP sales organizations, their pricing committees, underwriting departments, merchant support structures, and how their product divisions often long for direct access to merchants to gather new ideas, put me in an advantageous position. I’d say we have leveraged this ‘intel’ to our benefit over the last few years.
My experiences at Klarna, particularly in technical development and the challenges faced during my time there, have provided me with lessons that I can apply at LeoVegas Group as we build our product.
How do you balance the need for robust security with user convenience in payment systems at LeoVegas?
This is the eternal challenge: security typically introduces friction, which conflicts with convenience. Our customers expect a highly convenient payment experience, yet we must protect their payment methods and comply with AML directives and GDPR, as well as uphold our commitment to responsible gaming.
Some security aspects are beyond our control. The mandate of Strong Customer Authentication (SCA) introduces additional steps for customers, such as transaction verification, which we cannot always influence.
However, we do have control over our internal risk tools and procedures. We are constantly innovating to strike the right balance between friction and convenience, guided by data. Our goal is to detect patterns in our customer and payment processing data to make informed decisions about when to enhance security measures and when to prioritize convenience in the payment journey.
As a leader in a dynamic field, what principles guide your decision-making and leadership style?
At LeoVegas Group, we have a very distinct culture that guides us in this matter. We highly value this culture, as it is tailored to the dynamic environment of igaming. Our model is simple yet effective: we work with cornerstones that define what to do and attitudes that define how to do it. Our decision-making process is always aligned with these cornerstones. When making decisions, we ask ourselves:
- Is this decision data-driven?
- Will it promote innovation?
- Is what we are deciding upon scalable?
- Is it responsible?
It’s that simple.
Regarding my leadership style, I prefer others to be the judge. However, if I were to highlight one key aspect, it would be trust. While it seems obvious, building trust is actually quite challenging. Trust is not given; it must be earned and can easily be lost. Building a level of trust that fosters open and honest feedback, without fear of damaging relationships or one’s own position, requires significant investment. Yet, it unlocks levels of extremely effective collaboration and connection, creating a very satisfying working environment.