Ashley Nelson

The regulatory environment for video games, especially ones with in-app purchases and loot boxes, is shifting rapidly. In recent years countries across the globe have implemented new guidelines for keeping children safe and ensuring that age-gated content is only being accessed by those old enough. 

Specifically, many countries have instituted rules around loot boxes. Loot boxes are virtual prizes related to a video game often won by a gamer as a reward or can sometimes be purchased with real currency. These could contain anything from unlocking characters or avatars, equipment, or other things that could be an advantage in the game. Typically loot boxes can’t be viewed before purchase, so these items are blindly bought or won in the game. 

The most common games that appear are games like Roblox, Mario Kart, FIFA, Overwatch, League of Legends,CS:GO, and more. 

In 2020, the National Health Service in the UK released a statement saying, “Concerns have been raised about children playing video games which involve spending significant amounts of money – often without parents’ knowledge or consent – on so-called ‘loot boxes’, which are virtual collections of in-game purchases and other add-ons.” 

Continuing on it stated, “investigations have found numerous cases of children spending money without their parents’ knowledge, including a 16-year-old paying £2,000 on a basketball game and a 15-year-old losing £1,000 in a shooting game.” 

"The House of Lords Gambling Committee, a committee within the U.K.'s lower house of parliament, issued a statement in July 2020 calling for legislative action against the sale of loot boxes in video games. The committee concluded that microtransactions akin to loot boxes constitute gambling and fall under the legislative body's jurisdiction. As of yet, no laws have been made but given the committee's recent recommendation, it is probably only a matter of time."

In the past few years, the Netherlands jumped ahead of the EU in terms of loot boxes by outright banning certain kinds within the country. Belgium followed suit shortly after by declaring loot boxes to be an illegal form of gambling. This caused companies as big as Nintendo to pull certain games for sale in Belgium. 

In the United States, there have been proposed bills about banning microtransactions in games played by minors, but those bills have not gone to a vote. 

In 2020, the Federal Trade Commission released a review of loot boxes and in their Staff Perspective stated: “Some panelists view paid loot boxes as optional expenditures that benefit players by offsetting game development costs and allowing people to play games for free or at reasonable prices. Others cautioned that certain loot box tactics have caused consumers to mistrust industry motivations, a sentiment echoed in written comments submitted to the public docket.” 

In Australia, the Minister for Communications released a statement in March saying that Australia is introducing mandatory minimum classification of R 18+ and M for computer games containing paid loot boxes. The government also published a report that found an association between loot boxes and gambling addiction. 

Japan was the first country to take a stand on loot boxes within video games, and they did it over a decade ago. Japan cracked down on complete gacha, a monetization mechanic, which is basically a loot box variant in which individuals pay to get some random reward. According to reporting by ScreenRant, Japan stated that “complete gacha violated laws against “unjustifiable premiums and misleading representation.” 

As rules and regulations shift and change, video gaming companies need to be prepared to protect their reputation and comply with shifting regulations around in-app purchases, loot boxes, age-gated content, and more. 

Stay compliant with evolving requirements

Veriff helps ensure compliance in regions where age validation is required to purchase video games. Like ESRB in USA, PGI in EU & UK, ACB in Australia and USK in Germany.

Avoid fines and reputational damage with Veriff’s age validation technology that helps enforce age-restricted spaces that shield children from inappropriate content.

Veriff enables parents to confirm access which ensures their children only experience visuals and content that are age appropriate.

User experience is optimized to make the IDV process intuitive and require minimal manual user input. Real-time feedback and automated detection of document type and country get users onboarded quickly and effortlessly and helps businesses maximize conversions and protect their users.

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Video Game Crackdown for Lootboxes | Veriff

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Global crackdown on video-game loot boxes: What does this mean for your business? 

Onboarding

Chris Hooper

Trust is the biggest single contributing factor to marketplace success. High levels of trust reassure customers that their expectations will be met and give them the confidence to do business in a virtual space. High levels of trust not only lead to higher customer acquisition rates they also trigger significantly improved conversion, and customer retention.

Ultimately, marketplaces’ real value driver isn’t the platform or tech stack that makes transactions possible, it’s the level of trust they nurture to enable trade between strangers. 

Trust can be difficult to generate, however, because it results from the accumulation of customer perceptions and experiences over time. While it is hard-earned, trust can be lost very quickly, causing customers to swiftly and abruptly withdraw their business. A customer does not need to suffer loss first-hand. Sentiment in the form of negative press coverage, or even rumor can be enough to seriously erode levels of trust.

Does your marketplace have a robust trust stack?

Successful marketplaces assemble a kind of trust stack, drawing together a series of complementary processes, values, and protections, all designed to maximize customer confidence. A typical trust stack is likely to include the following layers.

Identity verification
The process of building and maintaining trust begins and ends with identity verification. In order to transact with confidence, marketplace participants must have trust in other users. They need to have confidence that the content others post on a marketplace reflects the product they’re selling. They need to know they’re transacting with a real person/business and that entity has an equally vested interest in that transaction. Swift, secure, and seamless identity verification processes and procedures are critical. 

Transparency
The more transparent a marketplace is about its policies, processes, and fees, the more trust it will inspire in its users. Participants need reassurances that the marketplace is accountable; that the information provided is true, accurate, and designed to benefit the customer; and that there are fail-safes in place to protect their interests. Successful marketplaces seek to be as transparent as possible.

Consumer protection
Leading marketplaces have clear policies to ensure customers are not left materially worse off when transactions go wrong. For example, Amazon, Etsy, and Alibaba, are among a host of marketplaces which refund customers if products are damaged or defective upon delivery. They also have a returns policy for products that do not match the description on their website.

Robust security 
Security is a critical component of trust for all marketplaces. Customers need to know that their personal information and payment details are safe. Industry-best practice involves sign-in using a secure server connection, 128-bit encryption of customer data and two-factor verification to ensure personal data, credit cards and transaction details remain secure.  

Social proof
Social proof, in the form of online reviews and testimonials, is a critical element of establishing trustworthiness. Customers need evidence that the marketplace/seller has a legitimate purpose and a regular customer base. This can take the form of online testimonials, reviews, good PR, and social media coverage, to name but a few. According to research conducted by the Spiegel Research Center, nearly 95% of shoppers read reviews before hitting “buy,” with the purchase likelihood for a product increasing by 270% if it has five reviews, compared to none.

While trust is critical, marketplace security systems and processes must not be allowed to negatively impact customer experience. Without care and sensitivity, identity verification in particular can add significant friction to the customer journey. This can trigger customer frustration and lead to customer drop-out at important touchpoints such as customer onboarding. 

That’s where Veriff’s market-leading Identity Verification (IDV) solution proves to be transformative. The solution can verify customer identity in just six seconds using a selfie and photographs of an individual’s government-issued identity documents taken using their smartphone.  

Veriff’s IDV solutions recognizes ID documents from across the globe and it verifies customer identity in just six seconds, with the highest accuracy rate on the market, enabling Marketplaces to onboard 30% more customers while achieving a high level of security.

Adopting a leading IDV solution, such as Veriff’s, is a clear choice for marketplaces unwilling to compromise on either customer trust or platform security. Check out our starter plans.

Low customer confidence is one of the biggest challenges facing online marketplaces, the answer lies in strengthening your ‘trust stack’ 

Low customer confidence is one of the biggest challenges facing online marketplaces, the answer lies in strengthening your ‘trust stack’. Learn more with Veriff.

Are Trust Issues Stifling Your Marketplace’s Growth? | Veriff.com

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Are trust issues stifling your marketplace’s growth? Here’s what to do.

Verificación de Identidad

Today, the gaming industry relies heavily on identity verification (IDV) to meet global and regional regulatory requirements. Additionally, using IDV in the onboarding process can offer a swift and seamless customer experience, ensuring player safety and establishing trust.

Identity verification: The core of an innovative online security strategy

Apuestas

Identity verification (IDV) is being increasingly adopted by the gaming industry to meet global and regional regulatory requirements. Furthermore, incorporating IDV into the onboarding process embeds a greater level of trust and safety between the operator and player.

Why IDV Ensures Trust And Safety For Today’s Gaming Players | Veriff.com

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Why IDV ensures trust and safety for today’s gaming players

Carl-Ruuben Soolep

It’s safe to say that online safety is a top priority for us at Veriff. As part of our Internet Safety Month activities, we’ve asked some Veriffians to take some time to reflect on the state of internet safety and what this month symbolizes and means for them.

Ninguna

It’s safe to say that online safety is a top priority for us at Veriff. Beyond our mission of stopping fraudsters and building trust online, it’s no secret that today’s consumers expect businesses to have the proper security measures in place to verify that users are who they say they are and foster safer online communities. If that trust is broken, businesses can face negative brand impact and the loss of users/customers. In fact, recent research shows that 40% of consumers have stopped buying from a company when it violated their digital trust.

Ask a Veriffian: What’s top of mind during Internet Safety Month?

Prevención de fraude

Nuestra sección de Noticias de Integración le brinda la información más reciente sobre la integración de clientes, permitiéndole integrar más clientes de manera segura y protegida.

Explore las Noticias de Integración y manténgase actualizado. Únase a nosotros para obtener noticias valiosas y manténgase a la vanguardia en la industria de la verificación de identidad. Aprenda más con Veriff.

Manténgase actualizado con las Noticias de Integración | KYC | Veriff.com

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Global crackdown on video-game loot boxes: What does this mean for your business?

Are trust issues stifling your marketplace’s growth? Here’s what to do.

Why IDV ensures trust and safety for today’s gaming players

Ask a Veriffian: What’s top of mind during Internet Safety Month?

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Latest Resources

Global crackdown on video-game loot boxes: What does this mean for your business?

Are trust issues stifling your marketplace’s growth? Here’s what to do.

Why IDV ensures trust and safety for today’s gaming players

Ask a Veriffian: What’s top of mind during Internet Safety Month?

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