Gambling with credit cards to be banned in bid to protect consumers

Andrew Cummings
January 15, 2020

Gamblers in the United Kingdom will no longer be able to use their credit cards to place bets online after a major shake-up of rules announced by the industry regulator.

The ban, which starts on 14 April, comes after reviews of the industry by the commission and the United Kingdom government.

"By making it a regulatory requirement for all online gambling websites licensed in Great Britain to sign up to Gamstop".

In 2018, several charities including Citizens Advice and GambleAware called on the government to bring in regulations to help problem gamblers in the UK.

From 14 April, people wanting to place bets online will have to do so by using either a debit card or through cash deposited into an account.

The commission says that the ban is meant to add a "significant layer of additional protection" to vulnerable people and those susceptible to gambling addiction.

According to analysts at Davy Stockbrokers, the ban on credit card usage for United Kingdom gambling deposits likely represents a low-single-digit percentage risk to related gaming revenues.

From a payments perspective, Jens Bader, Co-Founder of online gaming payments company MuchBetter, believes banning credit card gambling may not have the desired effect due to the availability of alternative options.

It is also reported that over 20% of people who gamble or bet online do so with a credit card, many of which are classed as having a gambling addiction or problem.

The use of credit cards in online gambling has been outlawed. Moreover, gambling with money they do not actually own could prevent players from actually realising the extent of their gambling, not to mention it could lead to chasing losses to a great extent, too. "This forms part of our ongoing work with our partners to implement the National Strategy for Reducing Gambling Harms". That is why we expect the industry to create safe products, know their customers, understand what they can afford to gamble with and identify when they are experiencing harm and step in.

Last year Department for Digital, Culture, Media and Sport ministers also met with banks and gambling operators to discuss their concerns.

It is thought that around 800,000 people use credit cards to gamble, with the regulator's own data showing that more than 165,000 customers made £46m worth of credit card deposits in February a year ago.

"Throughout 2020, we look forward to working with the Gambling Health Alliance to evaluate the current system and take forward evidence based recommendations for a wider package of measures to tackle gambling related harm and protect the public's health".

The announcement is the latest blow to gambling businesses, after the Government introduced a crackdown on fixed-odds betting terminals (FOBTs), which saw the maximum stake for bets cut from £100 to £2.

'But there is more to do. The watchdog said the move would provide "a significant layer of additional protection to vulnerable people". By the time the consultations were coming to an end, the commission's officials had already shifted gears to a total ban.

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