Cookies on the Gambling Commission website

The Gambling Commission website uses cookies to make the site work better for you. Some of these cookies are essential to how the site functions and others are optional. Optional cookies help us remember your settings, measure your use of the site and personalise how we communicate with you. Any data collected is anonymised and we do not set optional cookies unless you consent.

Set cookie preferences

You've accepted all cookies. You can change your cookie settings at any time.

Skip to main content
  1. Home
  2. Licensing authorities

Guidance

Guidance to licensing authorities

The Gambling Commission's guidance for licensing authorities.

Published
1 April 2021

Last updated
14 November 2024 - Changes

Document actions
Print or save (opens in new tab)

Contents

Our position

We will proceed with a ban on the use of credit cards for online gambling. We stated in the consultation (opens in new tab) that we were persuaded there are risks of harm associated with using credit cards for gambling, and the consultation therefore explored what action should be taken to protect consumers and minimise those risks, rather than whether any action should be taken. We have concluded that gambling with credit cards is not reasonably consistent with the licensing objectives of the Gambling Act, and the consultation produced no compelling evidence to dissuade us from intervention.

The data gathered from our call for evidence indicates that:

  • Credit cards are disproportionately used for gambling by individuals who are experiencing harm (among online gamblers who participated in our tracker survey, 22% of credit card gamblers were problem gamblers, 25% were experiencing moderate levels of harm and 20% lower levels of harm).
  • Credit cards are used for online gambling in a manner that could exacerbate harm. Data indicates that individuals are generally making gambling deposits via credit card over several transactions per month, meaning that cash advance fees will exacerbate their total debt. A number of credit card gamblers advised that the cash advance fees do not deter them from using credit cards for gambling, rather that they will chase larger wins to try to recoup the costs of using such cards.
  • Credit cards act as a convenient and relatively frictionless form of using borrowed money to fund online gambling.
  • The cumulative debt exposure from multiple credit cards can be much more than the user can afford to repay.

New research undertaken by 2CV during the consultation among 475 credit card gamblers also demonstrates that credit card gambling is disproportionately associated with those who may be at higher risk of harm:

  • half of credit card gamblers have a strong potential to encounter harm when gambling
  • credit card gamblers tend to demonstrate a lower awareness of the risks of gambling; however, they also tend to be highly engaged gamblers for whom credit card use to fund gambling is often embedded and habitual
  • credit card gamblers with a higher potential to experience harm tend to deposit larger sums for gambling, and make more gambling transactions, via credit cards than those with a lower potential
  • while most credit card gamblers in the research were not fully aware of the costs of using credit cards to fund gambling (that is, cash advance fees and often higher interest rates), those with a higher potential to experience harm were less likely to be deterred by such fees.

Some operators and financial services challenged that a ban on credit cards would not address the underlying causes of harm. We agree that gambling harm is often multi-faceted as it can manifest as various different types of harm for both the individual gambler and his or her family, and can manifest alongside other harms not directly related to gambling such as financial hardship caused by other circumstances. A ban on credit card gambling does not seek to address those wider complexities.

However, we expect it to be a measure that will reduce the risks of harm to many consumers by preventing them from gambling more than they can afford to repay; or at the very least, it will add levels of friction to the process of gambling with borrowed money such that the rate of financial loss is slowed down and harm is potentially curtailed. Consultation feedback demonstrates that it is not only credit card gamblers who are exposed to these risks but their family members also.

We are not persuaded that the loss of ‘credit card use’ as a variable in operators’ risk detection algorithms is an adequate reason to continue to permit credit cards for online gambling. That is, given the strong association between credit card gambling and harm, it would not be appropriate to continue to permit credit cards simply to enable operators to monitor their use as a basis for possible customer interaction. We note in any case that operators have not typically included ‘credit card use’ as part of their harm prevention models, rather they have tended to use the ‘number of payment methods’ on the customer account as a marker of harm.

Is this page useful?
Back to top