Credit card gambling ban draws industry’s ire
After the UK Gambling Commission’s announcement that it would enforce a ban on credit card gambling sparked debates as to whether Australia should follow suit, bookmakers argued that the United Kingdom and Australia are two completely different markets, and while in the former the credit card ban may not have a huge negative effect on the industry, that isn’t really the case in the latter.
Yogonet reports that in response to the Australian Banking Association’s call for views on the use of credit cards for gambling purposes, sports betting companies said a ban on online gambling credit card use could have devastating effects on wagering profitability and could be a big hit for the Australian racing industry.
Early this year, the UK Gambling Commission announced that it would enforce a ban on credit card gambling from April.
Australian-facing sports betting companies, however, argue that the UK and Australia are two completely different markets, and while in the former credit card ban may not have a huge negative effect on the industry, that isn’t really the case in Australia.
In December, the Australian Banking Association called for public views on “the place of a credit card and its use of gambling.”
Australia only permits the use of credit cards to make sports bets online.
These are not available at retail gaming facilities.
The banking association asked community members to voice their opinions on whether to prevent or limit the use of credit cards for gambling and how this would affect the bookmaking industry.
All able to share their views with the association had to do so until March 4.
Chief executive of Ladbrokes Australia Dean Shannon said that if a credit card ban is enforced, Australian racing, driven by wagering turnover, will see a decrease of more than 30 per cent in wagering value.
Mr Shannon went on to say that he believes such a ban “would be quite short-sighted and the flow on effects that would spin the racing industry into decline.”
The executive also pointed out that “a ban would primarily affect social punters because those are people who are used to buying online with a credit card for convenience in Australia.”
According to Tabcorp, Australia’s biggest bookmaker, a ban on using credit cards for gambling will significantly limit the choices available to the majority of betting Australia who wager within their means.
Tabcorp also predicts that if a ban were enforced, that would result in a decrease of more than A$10 million annually in distributions to the nation’s racing industry.
Another wagering operator responded to the call for views from the Australian Banking Association by claiming that around 80 per cent of its customers use credit cards to position wagers due to their convenience.
In her appeal for an opinion on possible credit card limits or an outright ban, Australian Banking Association chief executive officer Anna Bligh said in December that banks have “an important role to play in helping tackle the issue of problem gambling” and that the banking industry has been “assessing a number of options to help tackle problem gambling.”
UK bans credit card gambling from April
The UK Gambling Commission is banning people from using credit cards to place bets in an attempt to curb problem gambling.
The BBC reported in January that the ban, which starts on 14 April, comes after reviews of the industry by the commission and the government.
A total of 24 million adults in Britain gamble, with 10.5 million of those doing so online.
Separate commission research shows that 22 per cent of online gamblers using credit cards are classed as problem gamblers.
Gambling Commission chief executive Neil McArthur said: “Credit card gambling can lead to significant financial harm.
“The ban that we have announced today should minimise the risks of harm to consumers from gambling with money they do not have.
“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,” Mr McArthur said.
Culture Minister Helen Whately said: “Whilst millions gamble responsibly, I have also met people whose lives have been turned upside down by gambling addiction.
“There is clear evidence of harm from consumers betting with money they do not have, so it is absolutely right that we act decisively to protect them.”