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UK LEGAL COMMENT


UK credit card ban – all you need to know


Northridge Law partner Melanie Ellis answers the many questions around the UK Gambling Commission’s recent ban on gambling with credit cards


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s of 14 April 2020, Gambling Commission licensed companies will no longer be permitted to accept payments from customers via credit card, or from a money service business if the payment originated from a


credit card. The ban will be implemented by adding a new licence condition to the relevant types of operating licence, a breach of which can lead to a licence review. This article addresses some common questions about the effects of the new restriction.


Why has the ban been imposed?


The available evidence, from both the Gambling Commission’s surveys and the NHS’s health surveys, shows that levels of problem gambling are not increasing and, if anything, are gradually going down. What has certainly increased, however, is the impression amongst the general public that this is a growing problem, fuelled in no small part by negative media sentiment towards the industry. Regardless of the overall numbers, some people do become addicted to gambling and this can lead to serious financial difficulties as well as mental health issues, so clearly this is a problem that needs to be addressed. Credit cards have been a relatively accessible way for such individuals to obtain the funds to feed their addiction, so were an obvious target.


Who is affected?


The new licence condition applies to all online gambling operators offering betting, casino games or lottery products, with the exception of the National Lottery (however the National Lottery does not accept credit cards for online play). It also applies to land based betting shops. Land based casinos are already not permitted to accept


payment by way of credit card, due to a licence condition which prevents them from “knowingly facilitating” the giving of credit in connection with gambling. Customers will continue to be able to purchase National Lottery tickets and scratch cards from retail vendors using credit cards.


36 FEBRUARY 2020 How will this affect revenues?


Operators’ revenues are likely to be affected. Research commissioned by the Gambling Commission as part of its consultation exercise (carried out by 2CV) indicates that a quarter of those currently gambling using credit cards will stop gambling all together. This equates to around 3-4% of customers, when considered in the context of the RGA’s findings that 14% of gamblers use credit cards. But people do not always follow through on intentions


expressed in surveys. The survey results did not provide a breakdown of those who expressed the intention to stop gambling, so we don’t know if they are high or low spending customers, regular or infrequent gamblers or what types of product they gambled on. More importantly, we don’t know whether they are the customers who were using credit cards to fund a gambling addiction or the customers who used them for convenience or security. If I had to speculate, I would guess that those prepared to stop gambling altogether due to credit cards being unavailable are not those who gamble regularly and/or spend large amounts. So a 3-4% drop in overall revenues seems unlikely, however there is likely to be a noticeable effect. Despite media speculation to the contrary, my experience is that gambling operators do not want to make money from people with a gambling addiction. Despite their best


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