UK online gambling operators face a raft of stiff new rules covering everything from barring minors from using free-play online casinos to a potential ban on credit betting.
On Monday, the UK Gambling Commission released its Review of online gambling, which noted the rapid growth of the UK’s online sector, and the expectation that it will grow from its current 34% of the overall UK gambling market to 50% “over the next few years.”
The UKGC notes that online operators enjoy “a great deal of commercial freedom” compared to land-based operators, who are facing tighter curbs on gambling stakes, prizes and speed of play. But online operators collect “significant amounts of data” on their players, and the UKGC expects online operators to “use the data available to them to identify and minimize gambling-related harm.”
FOUR RECOMMENDATIONS
The UKGC is making four key policy recommendations, including scrapping the 72-hour window for age verification (AV), which the UKGC claims operators aren’t using anyway. Online gambling will only be permitted following positive AV, and free-play online casino sites will similarly be off-limits until AV has been completed.
The UKGC notes that it doesn’t currently have jurisdiction over free-play gambling-style games operated by companies not required to hold a UKGC license, although the UKGC has “concerns” about these sites’ capacity to “encourage young people to gamble.”
The UKGC will also require operators to conduct more due diligence before new customers are allowed to gamble. Operators would be required to set spending limits commensurate with a customer’s financial capacity, and these limits could only be raised following further verification that justified the raising of these limits.
The final two recommendations include previously stated concerns about unclear and/or unfair terms and conditions as they relate to promotional offers, along with beefing up the currently ineffective customer interaction practices to ensure earlier detection of problem gambling behavior and offers of assistance to mitigate said harms.
THE OTHER SHOE HAS YET TO DROP
The UKGC also identified five areas it plans to study to determine whether further intervention is necessary. These include using all that online customer data to develop standards for predictive models of customer behavior to facilitate harm reduction.
The UKGC also wants to review game and product characteristics that may encourage gamblers to exceed their limits, particularly in terms of reward offers within a single gaming session that incentivize customers to keep playing. The UKGC says it “will not hesitate to intervene on a precautionary basis” if it feels particular game characteristics have the potential to cause harm.
Other areas of concern include the controversy over operators’ confiscating funds in dormant accounts, and operators throwing up diligence roadblocks only when customers attempt to withdraw funds from their accounts. The UKGC says the latter concern may be addressed by its recommendation for stronger due diligence at the time of account registration.
Perhaps the most ominous of the areas of concern is whether to continue to allow gambling on credit. While the UKGC says it has more reviewing to do and will consult on its options, it supports the principle that “consumers should not gamble with money that they do not have” and that gambling via credit cards “increases the risk that consumers will gamble more than they can afford.”
The UKGC estimates that credit cards account for anywhere from 10% to 20% of all online gambling deposits. The UKGC says it will explore prohibiting or restricting credit card use but remains wary that such a move would push customers into even dodgier funding options, such as taking out high-interest payday loans.
The UKGC said the above policy proposals “are not the limit of our work” and that it will continue to work to raise standards across the online sector. The UKGC will provide further details on its timelines when it releases its 2018-19 Business Plan.
