Top 5 Things That Can Help Prize Payouts
Posted On: March 15, 2024 By :Whether it is a cornhole championship, esports fighting game tournament, pickleball, archery, billiards or surfing competition, paying out prize money to winners is not what tournament organizers most look forward to after putting on a major event or tournament. However, how quickly the players get paid is of utmost importance. No one wants to be blasted with competitor complaints about not getting paid. And event organizers want to comply with any financial and tax regulations to avoid costly fees, penalties and interest for non-compliance. Here are five things that can simplify prize payouts.
Simplify the Onboarding Process for the Winners: Prize winners don’t want to spend more than a few minutes onboarding onto your payment system, so filling out tax forms and providing personal information needed to receive payments must be straightforward and easy. Further, if someone has a question or needs help onboarding, they want to be able to pick up the phone, submit a support ticket, or send an email with the ability to engage a real person. A simple and quick payment process will build trust and loyalty with your participants.
Prevent Fraud & Adhere to Regulatory Requirements: Have you heard of the concept of check-washing? It’s a real thing in prize payouts: someone adding in an extra 0 and committing fraud. Even something as simple as someone not cashing in their check can lead to a mismatch on your balance sheet. Regulatory requirements are always changing and to be compliant, you need to make sure you are following the latest rules and financial regulations. Verifying identity and following the Know Your Customer and Anti- Money Laundering regulatory process is also paramount and something that can be streamlined and/or automated.
Automate Tax Information Collection, Reporting and Filing: Correctly collecting tax information can be a challenge in international prize money payouts, where many countries may tax prize money winnings. Tournament organizers might not be aware of the necessary withholding requirements and exceptions for international players and without using an automated platform that does this on your behalf, it can be a time-consuming task to manually collect tax forms and information. There are also penalties and legal repercussions if you don’t correctly handle tax information collection, reporting and filing. Getting winners paid in the easiest and most compliant way should always be top of mind.
Offer Multiple Payment Methods for Winners: Offering multiple, convenient and easy payment methods for your winners is a necessity. Gone are the days of cutting a check or offering one payment option when multiple fast, digital payments are available. It is important to provide customized solutions and a concierge service that can tailor payment methods to accommodate the preferences of all payees in the methods and currencies that they can receive. Today, prize winners require payment choice and speed and different individuals prefer various payment methods to receive their prize winnings. Event organizers are going to fall behind and not provide an optimal experience if they don’t offer options to those receiving prize money.
Use an Optimized Banking Network to Provide a Global Solution: Optimizing payment routes and ensuring that your winners receive the money in the currency they chose with the best conversion exchange rates is another strategy to implement, especially if your events and tournaments are global. Having an optimized global banking network with efficient payment routes will save time and money. Finally, as a tournament organizer, use a global payments platform with established payment routes and methods to minimize payment fees and expedite processing times for your prize money payments.”
Han Park is the chief executive officer of Payment Labs, a payment platform that empowers companies to issue quick and compliant payments to anyone, anywhere. The company has processed over $20 million in prize payments. Prior to Payment Labs, he was President of Turtle Entertainment America, a subsidiary of ESL Gaming.
Posted in: Expert Advice, Perspectives