Prize Payments wants to reduce time and cost of doling out esports pools
With over $300 million up for grabs in esports tournaments this year alone, paying out this money is becoming a longer, more complicated process. Prize Payments is hoping to make things easier for both players and organizers, saving time and money.
Sarah LeBoeuf,Wed, 14 Aug 2019 17:30:00
It’s no secret that esports is a lucrative industry. Esports orgs are raising millions in funding — that is, when they’re not making acquisitions (such as GameDaily parent company Greenlit Content) left and right. These organizations, game publishers, and highly skilled players are participating in what could soon be a billion-dollar industry. And as it grows, so do prize pools, and it’s estimated that $300 million will be won this year alone. With that much money on the line and a player base spanning the globe, paying out winnings in a timely fashion — without eating up too much of the cash prize — is becoming a bigger and bigger challenge for the community.
Enter Prize Payments, a company launching this week with the goal of making these rewards easier to manage on both sides of the transaction. According to the press release, “Prize Payments reduces the time and money needed to complete the payment process and can handle 115 currencies across 180 countries whilst ensuring each payment is compliant with taxation and GDPR requirements in each country.”
The release included some industry perspectives to give context to how these payments can be difficult to manage. As Halo coach Jake Bain notes, “Getting paid out is probably the worst part of the whole process. We are normally getting paid within one to two months, but for a few tournaments it can take up to four to five months. I obviously wish it could be more streamlined.”
Another problem with global tournaments: taxes. Popular Counter-Strike player Robin “Fifflaren” Johansson told Prize Payments that complying with tax laws and regulations as payments move from country to country can lead to confusion and frustration. “We were told we were always getting paid taxed money, there are logs from the old CEO. Then we were told that none of our taxes had been paid for nearly a year and a half: all the money we had made had not been taxed,” he said.
Prize Payments’ solution is to use an “intuitive dashboard” that lets pros on both ends of the transaction track what’s happening, with KYC/AML verification making sure each individual is who they say they are. Payments can be made via ACH domestic transfer, international wire, check, or PayPal, with the company claiming it “makes processing regional tax forms easy.”
CEO Han Park is an esports veteran, having previously served as President of the Electronics Sports League. In the press release, Park commented, “Making prize payments across multiple territories is hugely complex and time-consuming. With the increasing success of competitive esports, publishers and tournaments organizers are seeing their challenges and costs rise. Prize Payments streamlines the whole process, reduces cost, and helps to speed the process up for winning players.”
With esports companies spending approximately 10% to 20% of each prize pool on accounting, operational costs, and transfer fees, Prize Payments’ promise to save up to 50% of those costs is sure to be an attractive offer to tournament organizers. And as for players, you’re not likely to find anyone complaining about getting their winnings more quickly.