No wedge, no pledge!

16 Mar

Following a twelve week consultation undertaken by the Gambling Commission, it has announced that, as of 14th April 2020, gambling businesses are to be banned from allowing consumers to use credit cards to place bets.

The announcement comes two years after charity groups pressed the Government to implement measures to protect people from sliding into gambling addiction and, in 2018, the Responsible Gambling Strategy Board called on the Gambling Commission to consider restrictions on the use of “borrowed money” for online gambling.

The ban will apply to all online and offline gambling products (except lotteries that are run for good causes). However, these lotteries will have to provide a layer of additional protection aimed at vulnerable people. The Gambling Commission has said that tickets for these lotteries, as well as for the National Lottery, can be bought using credit cards in supermarkets and newsagents, as long as they are purchased with other products.

According to Gambling Commission Chief Executive, Neil McArthur, the rationale for the ban is that it should help to: “minimise the risks of harm to consumers from gambling with money they do not have”.

In addition, under the new regulation, all online gambling operators will have to participate in a new Gamstop self-exclusion scheme - which is a facility for those that have decided that they wish to stop gambling. Upon the individual joining the scheme, the gambling company must close the individual’s account and return any funds held. From 31st March 2020, gambling companies must offer this scheme to all customers, in order to keep their licence to operate.

In the past year, the gambling regulators have introduced a series of measures including bringing in tighter age and identity checks for online gambling.

To help those suffering from addiction, the Government has expanded national specialist support through the NHS Long Term Plan.

What does this mean for the Gambling Industry?

This announcement constitutes the most recent setback to gambling businesses, after the Government introduced a restriction on fixed-odds betting terminals, which reduced the maximum stake for bets from £100 to £2.

There are also on-going talks for a new Gambling Act - which will potentially introduce stricter measures for gambling licences.

The ban means that consumers will have far less access to funds, to place bets. The consequence of this new regulation could mean a significant reduction in revenue for gambling companies or worse, being shut down for non-compliance. Compliance is central in ensuring that gambling companies do not find themselves out of business.

To ensure compliance with the regulation, gambling companies must endeavour to ensure that the cards for payments are verified to be debit rather than credit cards. Furthermore, betting companies must sign up to GamStop before the 31st of March 2020 to ensure that they remain licenced to continue operating.

Costigan King is able to advise on any regulatory and compliance related matters you might have.

Please contact Arianne King, for more information.