Discover

If you haven’t read our article on Visa and Mastercard, here is a quick introduction to how these cards work. Firstly, four main credit cards are used in the Western world today: Visa, Mastercard, American Express, and Discover. These four “Card Networks” issue more than 99% of all the credit and debit cards in everyday use today.

The card networks are separate from the banks, so each bank has a contract with a card network that permits them to issue their cards. Banks will usually choose to give you a VISA or Mastercard, and as they issued the card, you should contact the bank if you have a problem – not VISA or Mastercard.

American Express and Discover work pretty differently – they not only have a card network of their own, but they also issue cards directly to consumers as well. You would imagine that this would make these cards cheaper to operate because of the integration of the two halves of the business, but things don’t seem to have worked out that way.

The popularity of Discover cards

Discover cards are rare outside of the United States. Most cards with the Discover brand are issued directly by the Discover bank, which only offers credit cards. It is possible to obtain a Discover debit card from a partner bank, but again these are still exceedingly rare even though Discover is the third-largest credit card brand in the United States.

The most recent data was compiled way back in September of 2019, so it is a little out of date by now. At that time, there were fifty-seven million Discover cardholders in the US. Considering that there are only around 240 million adults in the United States, this means that just shy of a quarter (23.75%) of American citizens currently hold a Discover card.

There is one fundamental issue with Discover and online gambling – the use of credit cards to conduct gambling transactions is now illegal in many countries that have fully regulated online gaming markets. The situation in the United States, as we all know, is hugely different – the country is only now slowly opening up to the idea of online gambling. Still, it will be many more years before the entire country has regulated casinos unless the federal government wakes up and does something about it.

So, can I use my Discover card for online gambling in the United States?

So far, all the states who have enacted online gambling legislation have decided not to get involved with restricting or regulating payment methods. That is a common feature of laws created in US states, which will always try and ensure citizens have the freedom to make as many of their own decisions as possible.

Because of this, many online casinos in the US do allow you to deposit using Discover. If the option is not available directly, it is perfectly legal to deposit to an e-wallet such as PayPal, Skrill, Neteller, or Revolut, and then make your payment from there.

Depositing via an e-wallet might actually be your best option, as depositing funds into these wallets is treated as a regular purchase, whereas depositing at an online casino Is regarded as a cash transaction as far as Discover is concerned. That means you will pay a much higher interest rate if you use your Discover card to deposit directly into an online casino compared to making an intermediary payment to an e-wallet first.

Can I use my Discover card for online gambling at offshore sites?

The short answer is no – almost every other regulated market in the world has already banned credit card transactions to online casinos. The regulators even require e-wallets to flag deposits made via credit card, so you can’t get around this restriction that way either. Even if you try moving your money between wallets, the flag remains attached to the funds. It does seem as if they have thought of everything – unless you want to pay the fees to deposit, wait for a withdrawal to your bank, pay the fees to deposit the money back into the e-wallet, and then play at the online casino a week later. You’ll probably have forgotten about the whole thing by then!

History

Sears created the Discover card in 1985. When launched, it offered a much higher credit limit than other cards. The large credit limit, together with a promise that they would never charge an annual fee, was all that was needed to make Discover highly competitive, significantly disrupting America’s existing credit card industry.

After the launch of DIscover, using their cards in an ATM was not possible other than those operated by the Discover Bank (formerly the Greenwood Trust Company). TO solve this problem, they purchased the electronic fund’s transfer service Pulse, which had the added benefit of allowing them to offer Discover debit cards to banks and other financial services companies who wanted to work with somebody other than VISA or Mastercard.

While American Express and Discover have made attempts to diversify their business and operate more like VISA and Mastercard, they charge the retailers who accept their cards a much higher per-transaction fee than the more extensive networks. Because of this, many companies refuse to accept any payments via Discover and American Express credit or debit cards.

Why has Discover found it so difficult to compete with VISA and Mastercard?

Until 2004, Visa & Mastercard operated as a cartel, preventing banks based in the United States (and some other Western countries) from issuing any type of card other than their own. Should a bank choose to break this agreement and begin offering a Discover or American Express credit card, they would lose the right to issue VISA and Mastercard’s credit/debit cards to their customers.

This situation was unfair, and American Express & Discover both sued their larger rivals in the US Courts. The courts ruled that those efforts by Visa and Mastercard – the world’s two biggest credit card companies – to restrict banks and other financial institutions from offering cards on rival networks were anti-competitive and broke antitrust law.

Discover sought $6 billion in damages as part of their suit. Discover settled their case out of court, so the exact figure they received is currently unknown. On the other hand, American Express decided to fight to the end in an epic courtroom battle, which resulted in them receiving $3.9 billion US dollars. It would certainly be interesting to find out if Discover got their $6 billion by settling out of court!

What does the future hold for Discover?

It’s always challenging to make such predictions. The company doesn’t seem too interested in expanding their international operations at this time, although a deal with HSBC allowing them to issue Discover branded credit cards could eventually see Discover start to appear in many more countries outside of North America.

The expansion of online gambling in the United States could turn out to be a massive boon for Discover, too, as they have no problem with people using their cards at any online gaming site that is happy to accept them.

VISA and Mastercard are beginning to clamp down on people using their credit cards for gambling transactions, even in the USA. While some casinos will use tricks such as tagging the transaction as “gaming” rather than “gambling” to avoid any blocks, loopholes like this will always be closed eventually.

How to deposit using Discover

First, read the previous section titled “So, can I use my Discover card for online gambling in the United States?” earlier in this article. You should now know that the best way to make a deposit using your Discover card at an online casino is to deposit the money into an e-wallet first and then deposit it to the casino from there.

While this extra step may seem like an unnecessary hassle, it could well save you a significant sum of money depending on how fast you pay off your credit cards.

Depositing via Discover directly:

If you aren’t concerned with higher charges (and by the way, you should be!), then go ahead and deposit directly to the online casino using your discover card. It should be a case of simply choosing the Discover option, specifying how much you wish to deposit, and then entering your card details. Many online casinos also charge additional fees for processing withdrawals back to credit cards, another expense you can dodge by using an e-wallet!

I always recommend not saving your card details at an online casino – it can be more convenient in the future, as you don’t have to type in your full name, the long card number, and all the rest of the information. However, if you use a modern browser such as Chrome or one of the many browsers based on the Chromium base, such as Brave and Microsoft Edge, you can save your card details into that instead.

If your credit card details are stored on your computer, you can feel sure that the information is secure, even if the casino is subject to an attack by hackers. It is just as fast and convenient as using the casino’s store card function but with far less risk attached. There is effectively no downside to using this feature, so why not make use of it?

Depositing via Discover using an E-Wallet:

First of all, you’ll need to find an e-wallet service that is available in your country. Many e-wallet companies left the US market after the UIGEA first came into effect way back in 2006. Thankfully, most of these companies have now returned. However, they will only permit gambling transactions to US casinos if you live in a state that already has online gambling legislation in place.

You shouldn’t have any problem depositing at an offshore casino, provided they are regulated and licensed by a reputable body such as the MGA or UKGC.

My favorite of the e-wallet companies at the moment is Revolut, which combines a ton of features into their service while charging exceptionally low fees – for example, transferring funds between my bank account and Revolut is instant and free of charge in both directions. None of the other e-wallets can currently compete with the convenience and flexibility offered by Revolut. They also support several of the largest cryptocurrencies and allow you to transfer funds between Crypto and Fiat directly from your Revolut account.

Opening your e-wallet will require some basic KYC, such as taking a picture of your passport and a selfie. Revolut checks these very quickly – for me, it was less than ten minutes – and once you have opened your e-wallet, you don’t need to wait for your card to be delivered before you can deposit and get ready to start playing.

Many online casinos will have the option to deposit directly via Revolut as one of their payment options, in addition to their competitors, including PayPal, Skrill, and Neteller.

With Revolut, it doesn’t even matter if your favorite casino doesn’t have a Revolut option. The company gives you a virtual card immediately after opening your account, which you can use to make a deposit using the casino’s Credit/Debit card option. All you need to do is open the Revolut app on your phone and make a deposit using your Discover card. You can now browse to your Revolut virtual card and use the details shown on the screen to complete your deposit.

How to make a withdrawal using Discover

Withdrawing should be just as easy as making a deposit, but that is not how things work in online casino land. If you want to make sure your first withdrawal goes as smoothly as possible, contact casino support as soon as you finish registering your new account.

Ask them how you go about submitting your documents for KYC, as they too will want a copy of your ID – either a government-issued ID card, a passport, or a driver’s license – as well as proof of your address. Some casinos might ask for other documents or pictures too.

I’ve had requests to take a picture while holding my passport at the side of my head. I’ve also been asked to take a picture of my debit/credit card with some numbers obscured. Screenshots of me logged into my e-wallets are another common type of request. It varies everywhere you go, which is why it is best to get all this sorted before you even begin to play.

Fingers crossed, the casino will check and verify your KYC documents before you have finished your gaming session, and you will be able to request a withdrawal straight away without any delays. You can ask the casino support rep how long it usually takes them to check a customer’s documents to get an idea if you are looking at minutes, hours, or days. If it takes days, I’ll often pick another casino to play at that night and return to the previous one once they have completed their KYC procedure.

If you deposited directly using your Discover card, your withdrawal will be processed as a refund in just the same way as it would be if you had purchased an item in a store with your credit card and then taken it back. As I briefly mentioned in the deposit section, there are sometimes fees attached to credit card withdrawals, so watch out for that. I have seen fees as high as 4% + $5 at some online casinos, making it pretty much pointless to play with anything less than $50-$100. The withdrawal will usually take between 3-5 business days to reach your Discover card.

If you followed my advice and deposited to an e-wallet, you will benefit from many advantages when making a withdrawal. First of all, there are usually no fees for e-wallet withdrawals unless you make lots of them in a single day.

Secondly, withdrawals to e-wallets are usually processed exceptionally quickly. Suppose you have a verified account with all KYC checks completed. In that case, some casinos will send the money automatically and instantly, meaning the cash will hit your e-wallet account the moment you hit the “Withdraw” button. From there, you are free to spend your winnings using your e-wallet card (every e-wallet apart from PayPal offers a pre-paid card alongside their service) or withdraw the funds to your bank account.

Paypal and Revolut process bank transactions instantly, whereas Skrill and Neteller can sometimes take several days.  I have noticed an improvement in this area over the past year or two – Skrill seems to be processing bank withdrawal requests within 2 hours during business hours. Still, if you make your request at 1 am, you will almost certainly be waiting until the morning, unlike with PayPal or Revolut.

Frequently Asked Questions

Which card is better, Visa, Mastercard, American Express, or Discover? I don’t get the option to choose which type I want at my bank, so I’m wondering if it is worth opening additional accounts simply to get a different brand of card.

It all depends on why you want the card! Remember, VISA and Mastercard process transactions, but they do not issue their own cards. They leave that part up to the bank, which simplifies their business model significantly compared to their rivals.

American Express and Discover also process transactions, but they issue their cards as well. Looking at both their websites today, I spotted a great deal for the Discover It Cashback Credit Card with no annual fee. It offers 5% cashback on select purchases, 1% cashback on ALL other purchases, and you will even receive a dollar-for-dollar match on all the cashback you have earned throughout your first year on the anniversary of opening your account.

That sounds like a surprisingly good deal to me, and the Discover card has numerous advantages if you want to use it for online gambling, as we’ve described earlier in this article. While Discover may not be accepted at as many retailers as VISA and Mastercard, all that matters is that you can use it to fund your e-wallet, and you are good to go.

You probably already have a VISA or Mastercard debit card from your regular bank, so why not get yourself a Discover card just for use online? And I would take full advantage of that cashback offer, too, if I were you – the 5% rate applies to Amazon.com, supermarkets/grocery stores, gas stations, and even when you deposit money into Paypal.

Suppose your favorite casino accepts PayPal, that 5% cashback can actually be considered a boost to your RTP. Now that’s what I call a great deal!

If I get a Discover card, who do I contact if something goes wrong?

Because Discover issue their cards, you call them directly if you have a problem instead of calling your bank if you have an issue with your Visa or Mastercard. The chances of you running into any issues with Discover are very slim, however. The JD Power 2020 Credit Card Satisfaction Study ranked Discover 2nd for customer satisfaction for the first time in years.

Overall, American Express has topped the study ten times, whereas Discover has grabbed the number one position six times so far. The two companies are well out in front, too – perhaps the fact that they run their network as well as issuing their cards makes it easier to provide an excellent service? The study certainly seems to suggest this is the case.

The things that have bothered customers the most are:

  • Denied chargeback requests
  • Refusals to honor the mandatory insurance that is one of the main reasons people prefer buying things using a credit card
  • Unexpected credit limit cuts.

The third-place contender, Bank of America, has over 100x more complaints about these three issues than both Discover and American Express put together.

In short – Discover seems to provide a world-class service, and this is backed up by data collected from almost 100,000 American credit card users.

If I make a deposit using Discover, do I have to withdraw back to Discover as well?

This depends on the casino, as well as the region in which you live. In some countries, you must send at least the same amount back to the card you used to deposit before you can withdraw using any other method. Apparently, this is to avoid fraud and money laundering, but it can be extremely frustrating in some situations.

If you have a problem with your Discover card – let’s say it gets suspended because you have fallen behind on your payments, so you don’t want your winnings to go there – then talk to the casino, and see if there is anything they can do. You can withdraw back to your bank account in many countries irrespective of what method you have used to deposit, as long as you have completed full KYC for that bank account.

If the casino insists that the payment has to go back to Discover, there isn’t a lot you can do – you could try telling them that you have closed the account if you are really desperate.

I’ve set up an account with the Revolut e-wallet you mentioned, but they are asking me for money for the card and insisting I pay more to top the card up as well. Is there any way around this?

Unfortunately not, no. The minimum you can spend on a physical Revolut card is $4.99 for delivery of a “free” card, and you have to add $10 to your balance at that time as well. Don’t worry, though – when you have finished applying for the card, you can send the $10 back to your regular bank account instantly, for free, if you want to.

Revolut offers several different cards, but you should be aware that they are not simply different designs – some of them have fees attached, whether annual or monthly. Some of them require you to sign up for their plus or premium packages as well. Bottom line – pay attention when deciding which card you wish to purchase!

I have a small amount of money in various Cryptocurrencies stored on exchanges and several other websites that I’ve had trouble withdrawing from for multiple reasons. Could I withdraw these funds to the Revolut e-wallet you mentioned and then use them to play at an online casino?

Absolutely, yes! Revolut currently supports Bitcoin (BTC), Bitcoin Cash (BCH), Ethereum (ETH), and Litecoin (LTC). The sites where your Crypto is currently stored should let you convert whatever you have into one of these four. I recommend Litecoin, as it has the lowest fees – and once you withdraw the money to Revolut, you can instantly convert it into dollars and use it to play at an online casino.

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