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.
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:
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 (eg a smartphone or watch) is essentially just a medium by which a contactless card payment is made (ie 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?