U.K. bans using credit cards for gambling
The U.K. will stop gamblers from using credit cards to place bets as the government continues to tighten regulation of the industry.
The ban, which goes into effect on April 14, pours cold water on any hopes among gambling companies that Prime Minister Boris Johnson -- elected with a majority last month -- might ease off on the stricter controls over betting introduced by his predecessors.
“In the past year we have introduced a wave of tougher measures,” Culture Minister Helen Whately said in a statement. “But there is more to do. We will be carrying out a review of the Gambling Act to ensure it is fit for the digital age and we will be launching a new nationwide addiction strategy in 2020.”
Shares of gambling companies opened lower after the announcement. William Hill Plc fell as much as 5.3%, GVC Holdings Plc dropped 3.8% and Flutter Entertainment Plc was down as much as 2.4%.
About 800,000 consumers use credit cards to place wagers, according to banking trade association U.K. Finance. About 22% of these are estimated to be problem gamblers, said betting regulator the Gambling Commission, which announced the ban on Tuesday.
“All operators among our coverage have disclosed that their credit card exposure in the U.K. is mid-single digits in terms of their deposits,” said analysts at Goodbody in a note to clients.
Some banks have already introduced tools that allow some customers to stop themselves placing bets. Trade group the Betting & Gaming Council acknowledged the credit card ban and said the industry will go further to identify people at risk of harmful gambling.
“Measures already introduced include new age-verification and affordability checks, additional funding for research, education and treatment and new codes of conduct,” council Chairman Brigid Simmonds wrote in an emailed statement.
The new rules come after the U.K. slashed stake limits on in-store fixed-odd betting terminals last year. The decision shook the industry and accelerated its push into the U.S., where a Supreme Court ruling in 2018 opened the door to sports betting across the country for the first time.
British and Irish bookmakers have rushed to partner and merge with U.S. firms to grab a slice of the new business.