Mastercard and Xsolla Team to Streamline Gaming Payments

Mastercard and Xsolla say they want to make payments easier for gamers.

According to a Thursday (Feb. 9) news release, Mastercard has teamed with the video game commerce company to create “frictionless, secure, and rewarding payments,” with offerings including in-game currency gifting and “improved creator payout processes.”

While billions of people play video games, Mastercard argues that digital commerce experiences haven’t kept up with industry growth. It says its in-house research shows large swaths of consumers are disappointed with the process of buying games or in-game currency or with gifting.

“As mobile devices increase the accessibility of video games, a rewarding, best-in-class digital experience is essential to fostering a loyal gaming community and building a payments ecosystem that provides choice across platforms and dimensions,” said Blake Rosenthal, Mastercard’s executive vice president for FinTech solutions.

The partnership follows a year in which mobile game sales hit a 10-year low after a massive spike during the COVID-19 pandemic.

“Boosted to prominence by the rise of smartphones and then app stores beginning around 2008, mobile gaming now represents roughly half of the nearly $200 billion games market, but sector analysts warn that figure is falling in key regions,” PYMNTS wrote in December.

Contributing factors to the decline in mobile game sales were essentially in line with the bad economy and consumer belt-tightening, especially among younger gamers with less disposable income for nonessentials like game subscriptions or in-app purchases of extra lives, virtual apparel and other trappings of the gaming universe.

Meanwhile, PYMNTS’ January 2023 playbook, “Enter the Metaverse: The Next Frontier of Digital Commerce,” looks at the evolution of gaming and payments. 

The study notes that the gaming industry is set to play a key role in the development of the metaverse, which will in turn transform gaming.

“At the center of it all, and essential to making the most of the emergent metaverse opportunity, regardless of industry, is establishing a future-fit payments infrastructure for this new merger of spatial computing and the internet that aims to become the next platform for human connectivity,” PYMNTS wrote earlier this week.

Crucial to bridging the gap between the physical and digital world and linking metaverse platforms is creating “a functional, flexible, and agile payments architecture.”

The study argues that — just as in-game purchases were transformational for the gaming industry — virtual transaction capabilities bring broader use cases to the metaverse and a lucrative new revenue source.