While the ban on the use of credit cards, and adding funds to e-wallets via credit cards for placing bets has been imminent, the announcement by the UK regulator it will come into force as of 14th April 2020, has sent waves through the UK industry.In the interim, it’s a political and intuitive way of showing solidarity towards the elimination of gambling related harm, but it has come under criticism as another ‘ simplistic solution to a complex problem’.
Impact Unknown
Operators have been preparing for the legislation on gambling using credit cards to come in to force but the efficiency of the ban will not be known until after the ban.The UK Gambling commission has reported that out of 24M UK players who gamble each year, 800,000 do so using a credit card. Neil McArthur from the Commission said, ‘The group is especially vulnerable, he estimates up to half will experience moderate to high levels of harm.’“ The evidence suggests that the risks to people depositing money using credit cards were significant both in terms of them gambling with money that is not theirs to start with and then fact that online it was encouraging riskier behaviour by making players more likely to chase their losses.”
Alternative Methods and Behaviours
As mentioned above, the impact the ban will have on reducing gambling related problems is yet to be seen, as with the affect the ban will have on revenues for operators, as not all players place bets via a credit cards and some will find alternative methods and behaviours.Warwick Bartlett, chief executive of Global Betting and Gaming consultants believes some gamblers use credit cards as they cannot exceed the card limit and, by using a credit card to gamble the risk of hacking is less detrimental, as the hacker can only steal the credit limit on the credit card, whereas if a debit card was hacked, this could wipe out entire life saving’s. The Commission has said ‘ they will monitor any unintended consequences as a result of the decision.’After the announcement of the ban, some major players, including William Hill, GVC and Flutter all witnessed a wobble in share prices but have all since recovered.Whatever the outcome, players will no doubt find alternative ways to fund their accounts. The evidence on credit cards and affordability is minimal so players will switch to an alternative method. Players with limited funds could use debit cards to fund their account and credit cards to pay for other general expenses.If the ban alleviates a percentage of gambling related harm then that can only be seen as a positive move, however the outcome is yet to be seen, longterm.