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Cashless payment technologies in gambling premises

Debit cards and contactless payments have risen in popularity. Advances in technology that enable payments via phone, watches and wristbands has coincided with a significant decline in the use of cash by consumers.

Gambling businesses are keen to make sure that they can offer their customers the same level of choice in payment options as other sectors of the leisure industry. Several operators have sought advice and guidance from us on their specific proposals for cashless facilities.

Whilst the developments in payment technology were not foreseen when the Gambling Act 2005 (opens in a new tab) and supporting regulations were drafted, the legislation does, in most respects, permit operators to innovate and make cashless forms of payment available. However, the legislation also provides some important consumer protection measures. These aim to reduce the risks of customers spending more on gambling than they might be able to afford, or exceeding their budgets for a gambling session. There are specific restrictions in relation to payments to use gaming machines detailed in the following information.

We are supportive of innovation, as long as the way in which it is done is consistent with the licensing objectives. We expect operators to ensure they are mitigating and minimising the risks of gambling-related harm when they make new payment facilities available in their premises. Operators should also be leading the way on identifying how innovation in products and services can support innovation in protecting and empowering consumers.

The responsibility rests with operators to be able to demonstrate that their payment solutions have been designed and made available with player protection measures in place. We may consider taking regulatory action in individual cases if, for example, an operator was to increase the risk of harm to its customers without providing appropriate mitigations. We may also consider options such as changes to our Licence Conditions and Codes of Practice (LCCP) or advising government, in order to strengthen controls where necessary.

Minimising gambling-related harm

We encourage operators to consider how they can gather data both before and after the implementation of any measure so that they can demonstrate the impact of control measures.

Considerations for operators

Research has shown that individuals can frequently gamble more money than they intended during gambling sessions. This leads to them making impulsive decisions that override their initial intentions to allocate a set amount of money to gamble with. Easy access to additional funds in gambling premises can therefore be a risk factor for problem gambling. Key issues in product-based harm minimisation (opens in a new tab) by Parke A, Parke J and Blaszczynski, A, was published in December 2016, and is a summary of research evidence.

Research also shows that non-cash payment methods in gambling can lead to consumers over-spending, as such methods require less thinking about the actual cost and affordability implications of a transaction compared to cash payments.

It is for operators to consider how player protection and empowerment can be most effectively delivered in practice.

They are best placed to assess which measures are:

• most effective in mitigating the risk of customers spending more on gambling than they might be able to afford
• which are most effective in enabling customers to retain control over their own gambling spend. Operators may need to take account of specific risks such as the layout of their premises or vulnerabilities for particular customers.

As part of their assessments on how they can best mitigate harm, operators must consider how they can facilitate the following. While there is no evidence to suggest what the ideal duration of a break should be, wherever possible the customer should at least be required to cease gambling at, and physically leave, the machine, terminal or table at which they are situated. This provides some time away from the gambling facilities before they are able to access and use new funds. This is consistent with the mandatory conditions attached to all premises licences that any ATM is located in a place that requires customers to cease gambling and leave the gambling product in order to use it.

In any circumstance where customers might be able to access new gambling funds with only a limited or no physical break from the gambling product (for example, where customers might be able to use a debit card to replenish an app-based digital gambling ‘wallet’), the operator must ensure that customers are otherwise provided a break from or an interruption in gambling before those funds can be used.

Customers should be required to take a break from gambling before they access and use new funds to continue gambling

The purpose of the break or interruption in play is to reduce the risk of harm to players that could arise from them losing track of the time and money they have spent gambling. By interrupting their state of dissociation, a break in play can give customers an opportunity to evaluate their own gambling behaviours, and could therefore facilitate better control (see Operator-based approaches to harm minimisation in gambling (opens in a new tab), by Parke A, Parke J, Blaszczynski, A and Rigbye J, published by Gamble Aware in 2014). A break or interruption in play could therefore involve, for example, slowing the transactional process and providing delays before new funds are made available to the player for use; perhaps combined with informative messaging, so as to support the player’s control and awareness of their gambling spend.

Operators should use these new opportunities to support innovation in the protection and empowerment of consumers. For example, cashless payment technology may assist operators in tracking their customers’ play, allowing them to collect better data on their customers’ gambling behaviour and therefore helping to inform an assessment of those who may be at risk of gambling-related harm.

The new technologies may also assist in the provision of tailored responsible gambling information to customers, including transactional information on the sums of money they have spent or withdrawn; or the development of player-led controls to enable better self-management of the customer’s gambling (for example, allowing customers to set their own spend or withdrawal limits).

Licence Conditions and Codes of Practice: cashless payment

There are certain conditions and codes of practice that must be adhered to when providing cashless payment facilities. These include, for example, the need to implement effective policies and procedures for minimising certain risks to the licensing objectives; and provisions that limit the circumstances in which credit can be provided, or prevent credit cards being accepted (and where the Gambling Act does not otherwise prohibit or restrict any such facility).

Operators should refer to the LCCP for full details of the following relevant requirements:

• Licence condition 5.1 – cash and cash equivalents, payment methods and services
• Licence condition 6.1 – provision of credit by licensees and the use of credit cards
• Social responsibility code provision 3.7 – provision of credit

The Gaming Machines (Circumstances of Use) Regulations 2007 (opens in a new tab) provide prohibitions and restrictions on the use of debit and credit cards for payments to play machines, which are straightforward safeguards intended to prevent consumers from gambling more than they can afford via a card.

Specific matters in relation to gaming machine payments

Our view is that card payments that originate from contactless mobile payment systems such as Apple Pay, Android Pay or Samsung Pay should be regarded as the same as payments to use a gaming machine by means of a card itself. This is because the device used for such types of payment (for example, a smartphone or watch) is essentially just a medium by which a contactless card payment is made (that is, the debit card sat behind the payment system is charged directly and the customer’s bank account is debited; the same as for any payment where the debit card itself is used).

Both contactless card and mobile payment system transactions can be completed quickly, and so the risks to the consumer are largely identical.

The regulations also prescribe limits as to the amounts an individual can deposit onto a gaming machine in any single action, and separately the (non-refundable) amount a player can commit to play the machine. These measures were designed to ensure consumers make regular decisions as to how much money they wish to commit to play a machine, and they must be observed regardless of the means of payment. That is, whether the customer has inserted cash into the machine, or whether they have transferred funds from a debit card via indirect means, a TITO (ticket-in, ticket-out) method or an operator-provided app-based digital wallet, a customer must only be able to deposit and commit funds to the gaming machine’s meters in accordance with these limits.

Checklist of considerations

We welcome sight of novel product or concept developments before they are deployed in the market. We do not approve individual products, and the responsibility rests with operators to ensure that their developments are compliant and will help to deliver the licensing objectives of the Gambling Act. It is recommended that businesses obtain their own legal advice in this regard.

To assist developers we have provided a broad checklist of items that we expect them to have considered before contacting us. The list is not exhaustive and must not be considered in isolation from the previous advice. It provides a basic list of key issues.

In respect of the cashless technology product or system you are developing, you should be able to fully explain:

• How you will make sure that consumers are required to have a break from gambling before they are able to access and use new funds.
• How you have satisfied yourself that you will be compliant with the Gaming Machine (Circumstances of Use) Regulations in respect of the use of debit or credit cards, payment limits and committed payment limits.
• What anti-money laundering controls you have considered in designing your solution. For example, would a player be able to fund a gambling product via cash and then withdraw funds via an app or digital wallet?

There are also a variety of harm mitigation and consumer empowerment measures that you should consider. You should ask yourself:

• What information can your product provide to the consumer about their own gambling? For example, will consumers be able to access information on their transactional gambling history over certain periods of time?
• Are you able to provide tools that enable the user to manage their gambling? For example, can the consumer use the product to set limits on the amount of money they are able to deposit or spend over a certain period of time?
• What alerts would be triggered when a limit is reached? How will the limit-setting be made effective in terms of reducing the risk of gambling-related harm?
• Does the product allow for users to voluntarily stop themselves from using the product for gambling purposes for a period of time? Or provide a cooling off period period whereby the product cannot be used for gambling for a certain period of time?
• If the product or system is to be made available for use with different gambling products (including different categories of gaming machine), how will you ensure that your solution is adaptable and able to respond to the different nature of each gambling product and the associated risks or legal requirements?
• Does your solution enable you or a gambling operator to monitor customer behaviour (for example, the gambling spend or intensity of an individual customer) over a period of time?
• How can you prevent, or assist in the prevention of, underage gambling?

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Last updated: 8 June 2021

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