The UK Gambling Commission (UKGC) has brought the boom down on gambling with money borrowed from credit cards or fintech institutions.
Under new license condition, 6.1.2, betting operators can no longer accept payments by credit card — either directly or through any Money Service Business (MSB); such as an e-wallet, fintech or electronic money institution that allows e-money transfers and deposits to credit cards.
In a statement the UKGC said: “One of our key intentions in banning gambling with credit cards is to maximize the levels of friction during the process of accessing and using borrowed funds for gambling, in order to reduce the risk of consumers experiencing harm from gambling with borrowed money.
“It is important for operators to ensure that the credit card ban cannot be easily circumvented by simply topping up an e-wallet, or online money transfer account, directly from a credit card, where those funds could then be used for gambling with very little friction in the transactional process.”
The onus is now on gambling operators to prevent gambling payments from all these types of sophisticated fintech products.
Operators will now reject all payments made through MSBs that have not developed a ‘block’ to prevent credit card deposits being used for gambling through their e-account or e-wallet facilities.
The UKCG has highlighted the best practice example of banking services provider Revolut, which has blocked any online or offline gambling transactions for its credit cards.
All other electronic money institutions must follow suit, said the commission; warning licensees that they must be satisfied there is no danger of an MSB allowing customers to gamble by making deposits using credit cards.