The recent announcement by the Gambling Commission (UKGC) that gambling firms & UK Based Betting Websites will no longer be able to accept credit card payments from customers in the United Kingdom is a landmark decision for the industry.
The ban, which will come into force on April 14, is being implemented to provide an additional level of protection to vulnerable people. It is the latest in a series of legislative changes to be introduced that are designed to ensure that the UK gambling industry is seen to operate in a fair manner.
Studies have shown that 800,000 consumers in the UK used a credit card for gambling during 2018, with almost a quarter of those classed as problem gamblers, highlighting why the UKGC has introduced the new rule.
Read on as we take a closer look at the newly-introduced ban on credit card payments and assess how it will affect betting websites in the UK over the next few years.
Pressure forces change in the UK
Research by the Royal College of Psychiatrists says that gambling is a problem for approximately one percent of the population in the UK.
While this is a relatively small amount in the grand scheme of things, it is a figure that many organisations have expressed a desire to see reduced even further.
Charity groups such as Citizens Advice, GamCare and GambleAware have all called for the gambling industry to do much more to tackle betting addiction.
The Gambling Commission’s chief executive, Neil McArthur, acknowledged that gambling with a credit card can cause ‘significant financial harm’ to people.
“The ban that we have announced should minimise the risks of harm to consumers from gambling with money they do not have,” he told the UKGC’s Official Website.
“Research shows that 22% of online gamblers using credit cards are problem gamblers, with even more suffering some form of gambling harm.
“We also know that there are examples of consumers who have accumulated tens of thousands of pounds of debt through gambling because of credit card availability.
“There is also evidence that the fees charged by credit cards can exacerbate the situation because the consumer can try to chase losses to a greater extent.”
New legislation will drive change where it’s needed
Realistically speaking, the new legislation should certainly go a long way to addressing the issue of problem gambling.
While just 1% of the population in the UK are said to be problem gamblers, the other 99% of people who place bets on a regular basis do so without any issues.
Preventing vulnerable people from racking up huge credit card debts is undoubtedly a major step in the right direction, but it is not one which will have a huge impact on bookmakers’ profits in the long term.
Most betting websites in the UK will continue as normal, with gambling firms still able to offer many other popular payment methods to their customers.
Punters can still bet with payment methods like Boku and many others that are easy-to-access, providing the funds do not come from a credit card.
With all online gambling operators also needing to sign-up to the GamStop self-exclusion scheme by the end of March 2020, the industry appears to be well on its way to tackling problem gambling.
For the people who sadly struggle with addiction, the new rules will clearly put much-needed barriers in their way with regards to placing bets online.
However, for the 99% of punters who enjoy gambling without any such issues, the revised landscape is unlikely to make too much different to their activities moving forward.