The 14th of April 2020 marked a significant day in the history of gambling in the UK. Following many discussions over the use of credit cards for the purpose of gambling, the UK Gambling Commission (UKGC), along with the UK Government placed a ban on credit cards as a payment method on UK-licensed online casino operators.
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The measure was one of the first to be introduced in line with the UKGC’s stance against problem gambling following the increase in online casino activity in the UK. Initially, members of the gambling community could not understand the reason for just banning credit cards as other forms of payment method were still available and able to make sizeable transfers.
However, the difference was that credit cards worked on the principle of “borrowed money,” before any amount was eventually paid off. For players, the computer simply said no, but for the UKGC, there was a lot of work that went into setting up the correct agreements to ensure that players could not fund their gambling habits with credit cards.
Playing on a credit card casino is still possible in some markets and online gambling platforms that are licensed with other reputable license providers such as Curacao, Malta, and Gibraltar, but the UKGC’s objective was to promote healthier gambling habits in what was one of the first of many initiatives that have been introduced since 2020.
Liaise with Banks
With such an initiative that was introduced through the Licence Conditions and Codes of Practice (LCCP), the UKGC had to cut the supply off from the source. That meant communicating with banks and credit card issuers to ensure they blocked any transactions that went to licensed gambling operators.
Banks can identify gambling companies by the Merchant Category Code (MCC) that is assigned to each business, which is also responsible for determining the interchange fee and more indirectly, any transaction fees involved with past credit card transactions.
Collaborate with Operators
Alongside working with the banks, the UKGC also had to ensure that both ends of the transaction pipe were plugged. This involved placing additional responsibility on gambling companies and operators to remove credit cards as an available payment method and to place blocks on any attempts to make deposits or withdrawals with a credit card.
Operators were largely happy to comply, due to the fact credit card transactions made up a small percentage of the revenue and they could also prove to the public that they were doing their bit to promote responsible gambling and protect the vulnerable players.
How effective has the ban been?
While there is no doubt the ban has assisted with reducing the number of problem gamblers in the country, there are still 1.4 million Brits that admit to a problem with gambling. One of the main challenges for the UKGC is finding a way to affect the access to international markets where the same rules do not apply.
The UKGC heeds caution in using overseas operators, especially ones that are unlicensed and belong to the illegal market. But that task is just one in an extensive line of potential measures to be applied in the future as the UKGC looks to build on the work done in preventing credit card gambling in the UK and the stance set against problem gambling.
