In Germany, PayPal is synonymous with convenient, fast, and comparatively secure online payments. However, the company has deliberately redefined its role in the gambling market in recent years. The trigger was the reform of the State Treaty on Gambling 2021, which put the previously somewhat gray online market on a clear footing. Central to this is § 4 (1) sentence 2 GlüStV 2021, which sets the tone: "The organization and brokering of public gambling without permission is prohibited. Payment services may not participate in the operation of unauthorized gambling." For payment providers such as PayPal, this means: no processing of payments to unlicensed platforms, no cooperation with providers who circumvent the German legal framework, and clear risk assessment processes. This requirement closely links regulation and payment transactions and has noticeably changed the market. Whereas PayPal used to be a standard option in international online casinos, the company switched to stricter verification mechanisms in 2019 and enshrined an explicit ban on transactions to illegal gambling sites in its own terms of use in 2020. In practice, this means that only those who have a valid German license can officially and permanently offer PayPal.
What specifically changes for players and providers
For licensed providers, the renewed availability of PayPal is a confidence booster. Approval in Germany is granted by the Joint Gaming Authority of the German States (GGL), which also maintains the whitelist of licensed providers. Those listed there meet requirements for player protection, deposit limits, identity verification, data protection, and responsible marketing. The fact that PayPal is reappearing as a payment method under these conditions is more than symbolic: it eliminates friction losses because deposits and withdrawals work smoothly, and it signals that a provider has arrived in the regulated system. For players, this reduces a key risk of the former gray area: the uncertainty of whether deposits will disappear, withdrawals will be delayed, or disputes will end up in limbo. PayPal stands – within the scope of its capabilities – for traceable payment flows, transparent processes, and buyer protection that, while not covering every gambling dispute, can address abuse and technical errors. At the same time, case law in Germany has dealt with legacy issues: Several regional courts have upheld claims for reimbursement against payment service providers in individual cases where customer funds were transferred to unlicensed casinos; the reasoning is generally based on the invalidity of prohibited contracts (Section 134 BGB in conjunction with Section 4 GlüStV). At the same time, the line is no longer uniform: the more courts focus on whether players knew about the illegality or accepted it, the lower the blanket prospect of reimbursement. This change has direct consequences for providers without a German license. Many are turning to alternatives – such as cryptocurrencies or e-wallets such as Skrill, Jeton, and MiFinity. These alternative measures may be pragmatic from the operators' point of view, but they shift the risk entirely to the players. Those who deposit outside the regulated framework find it difficult to legally enforce winnings, bear the risk of frozen funds, and forego the protective mechanisms that the licensed system mandatorily provides. Here, PayPal's clear line acts as a filter: what is not regulated should not be enhanced by convenient payment methods.
PayPal's change of course also has an international dimension. In countries with mature regulation – such as the UK, Spain, and Italy – the service has been working with approved providers for years. In the US, it is up to the individual states to decide: where online gambling is properly licensed, PayPal is part of the standard; where the framework is lacking, the company holds back. Since 2021, Germany has joined the ranks of those markets that balance access and protection conditions: legality, transparency, and supervision on the one hand, gaming opportunities on the other. This is paying off for the industry. Reputable providers are gaining credibility and can attract customers with a familiar payment logo. For media companies, comparison portals, and information providers, a clear checklist is emerging: license available, whitelist entry given, PayPal active – then at least the regulatory foundation is in place. For consumers, the path to a safe decision has become much shorter: if the provider is not on the GGL whitelist and offers PayPal, skepticism is warranted; if it is on the whitelist and accepts PayPal, this speaks strongly for the legitimacy of the offer.
The bottom line is that the German market shows that regulation does not have to be the antithesis of innovation. PayPal's stance is not just lip service, but active compliance: the link between Section 4 (1) sentence 2 GlüStV 2021 and operational control processes in payment transactions makes all the difference. For players, this means that anyone who makes a deposit with PayPal in Germany today is highly likely to be operating in a licensed, audited environment. For providers, it means that anyone who wants to grow sustainably needs the license, the processes, and partners who take this seriously. And for regulators, it is an effective lever: by ensuring that central payment flows can only pass through the legal eye of the needle, the gray area is gradually drying up. This is exactly how we can create what this market has been missing for years: predictable protection for consumers, fair competitive conditions for legal operators, and an anchor of trust that combines digital convenience with legal clarity.