The Future of Player Protection: Affordability and New Technology

As the release of the UK Gambling Act Review looms ever closer, the iGaming industry seems to be bracing itself for what many expect to be an increasingly restricted market.

Some industry commentators believe that this may be the wake-up call the market needs to finally tackle some of the major player protection issues that have plagued us over the years.

We recently caught up with Frazer McNaughton, Head of Safer Gambling for GIMO (NetBet). In this conversation he shares his perspective on what we can expect from the upcoming release of the Gambling Review, how we can prepare for this and most importantly, what role aspects such as affordability checks and new technology will play in the future of player protection, hopefully shaping future legislation for the better.

Player protection is more important than ever to the iGaming industry, especially since the Pandemic and has attracted a lot of extra scrutiny from public stakeholders. What role do you think self-regulation plays in combating this issue and how can we, as an industry, be more proactive in this aspect?

“Whilst it is fair to say that there has been extra scrutiny from government and the media in recent years around the gambling industry and iGaming in particular, it is more realistic to say that the pandemic has brought iGaming into sharper media focus. At the end of the day, the public deserves an industry that they can trust and with adverse public attention, that’s going to be something we as an industry need to work on combating together. The gambling industry has historically been reactive in terms of regulation, ultimately, in many cases waiting until the last moment to bring themselves into a compliant position – too often after customers have come to harm and in many occasions only after a fine has been issued by the UKGC. With the National Strategy to Reduce Gambling Harms having ended in April and with no explicit strategy having been released since, I believe that this is a genuine opportunity for us as an industry to take the lead and champion better collaboration between operators; to share best practice and to help each other to build more compliant, safer and more sustainable customer environments.

“From a social responsibility perspective, we could do a lot more and shouldn’t wait for regulator direction. We regularly see operators publicising their own player protection projects, however, it’s much rarer that we see the data showing whether the projects have successfully helped to reduce harms related to gambling. There is an opportunity here for us to come together as compliance professionals to talk about what works well for us (and what doesn’t), any feedback we’ve had from the UKGC and generally to help each other to improve. In my opinion, collaboration like this will be one of the keys to a sustainable future for iGaming.”

Some industry commentators believe that regulators have put too much reliance on wholistic legislation such as credit card bans and deposit limits and not enough on affordability. Do you think this is an aspect that will be more heavily focused on in the future and how can operators stay ahead of the curve with this?

“Affordability as a subject is a hot topic within the industry, and always will be. Whilst there is no silver bullet in terms of social responsibility and, indeed, anti-money laundering, I believe that affordability profiling at the earliest possible opportunity gives us a better chance to mitigate the risks inherent in accepting customers into our businesses and also to build a more sustainable relationship with our customers from the outset. The UKGC has been asking operators to consider affordability now for years without ever specifically prescribing what this should look like.

“There is no singular correct answer to how we can stay ahead of the curve with affordability. Now that we are beginning to see various potentially viable solutions come to market, the government and UKGC may well begin to legislate based on best practice they’ve seen during assessments. This leaves the gambling industry with a few options, namely: ignore our social responsibility to prevent harm coming to at-risk consumers and continue to build a negative public opinion of the industry or be ethical and address this issue with a sustainable and effective industry-wide solution.  On the subject of creating sustainable solutions, I have found that embedding a culture of continuous improvement at all levels of the compliance team and wider operation is key. This allows teams greater breadth in terms of horizon planning and ultimately helps us to stay ahead of the regulatory curve.

“I believe in taking people on a journey: it’s easier to get buy-in from senior stakeholders when you can show them how far the organisation has come already. Once they’re on that journey with you and reaping the benefits, you’re likely to face much less resistance on future projects.”

The Gambling Act Review is due to be published very soon. What do you expect the outcome and impact of it to be and how can we best prepare for this?

“The Gambling Act Review is likely to represent a significant tightening up of what is already a strict regulatory framework. We have been waiting with bated breath for a few years now for an update and I have to say I’m hopeful. I would like to see the Review take into account best practice that has been witnessed across the UK gambling industry. This would demonstrate to operators that greater collaboration with the regulator and compliance innovations can lead to positive recognition which can only be good for reputations and would represent a significant change from the current status quo where we only see the negative outcomes published.

“It would be a refreshing change to see the Review also show learnings from other regulators. Take Ontario for instance, where we’ve seen swift action taken on non-compliance within the first few months of licenses going live. Imagine how much more efficiently we could close policy and process gaps as an industry if we saw fines and statements published within months of an assessment rather than a year or more later. For me, this is a critical opportunity to develop a more real-time framework for policy review.”

What role does technology play in the journey towards complete player protection? Do you think new products based around AI, machine learning or even Blockchain can provide complete player safety, whilst still maximising the customer experience on a large scale?

“I would agree that technology plays a pivotal role in our pursuit of player protection – particularly as we see machine learning, AI and in some instances Blockchain being leveraged in efforts to reduce harm. With that said, I think we have a long way to go and I don’t think we will ever fully eliminate the need for in-person reviews: the human element is essential and it’s important we don’t lose sight of that in the pursuit of perfect player protection!

“I expect to see something of a culture shift from reactive treatment of harms after the fact towards a more proactive and preventative approach towards player protection. Advancing technologies allow us to level up our game as operators by giving us the opportunity to detect key indicators of concern more accurately than ever before. Often, this software is able to detect underlying patterns which precede harm long before a human might spot this.

“Whilst there are several phenomenal offerings from B2B suppliers out there, some operators may feel that they are priced out of the market or that they are unable to justify the commercial impact of paying an external company to help them up their player protection game. This isn’t the only way – if you’ve got a savvy compliance team and some dedicated developers, it might be worth your while building your own automation in-house.

“We did this at GIMO and produced some complex algorithms which have resulted in a fully custom and scalable affordability profiling process which the UKGC has commended as appropriate and effective during a recent compliance assessment. The UKGC provided guidance back in 2019 which signposted most of the data we based our model on and we have built on this by almost fully automating the process from registration.

“This would not have been possible for us without the full backing of our senior team and board, which let us truly home in on how we could best use the technology at our disposal to effectively mitigate risk from registration to better protect our customers. The commercial beauty of it is, though, that we’ve now got a much more sustainable customer base which is managed efficiently from the get-go. As the old adage goes it’s better to have 10,000 customers spending £100 each month than having 100 customers spending £10,000 in a month… and then self-excluding.”

Operators or content providers often have different ideas than regulators when it comes to what may be considered as practical legislative frameworks to implement. How can these industry stakeholders better align and collaborate to create the safest and most competitive iGaming market possible?

“I think this is quite a negatively loaded topic: many commentators are looking for opportunities to score points against their competitors and also their regulators. Unfortunately, this is a no-win situation without effective collaboration.

“With more willingness to come to the table and starting to share best practice, particularly with regards to player protection and affordability, we might start to level the playing field between operators and increase regulator confidence that we are capable of self-regulation to a greater extent. This would allow us eventually to move towards a more competitive market where the consumer could choose their brands based on the quality of the product and user experience rather than which operator asks the least questions or allows them to spend the most without intervention.

“My final point on this is to call out to other operators and regulatory bodies – take a look at your internal operations and if you think something is truly excellent from a player protection perspective, shout about it. Share it with everyone who will listen. Sure, your competitor might make use of your idea and ultimately create a platform which the regulator sees as compliant and effective at protecting their customers. But isn’t that what we’re all trying to achieve anyway?”

Editor’s Note:

After catching up with Frazer, it’s very apparent that technology plays a pivotal role in our industry’s pursuit of player protection. Tech such as AI and Machine learning will be the most effective tools our industry can use to support the responsible gaming campaign. Frazer has cautioned, however, that these technologies are very powerful and impressive but will never completely be able to replace in-person reviews.

It’s no surprise that Frazer expects the Gambling Act Review to encourage a significant tightening up of what is already a strict regulatory framework. However, he’s also hopeful that the Review will consider best practice already witnessed across the UK market. This would help demonstrate to operators that greater collaboration with the regulator and compliance innovations can lead to positive recognition, which can only be good for our industry reputation and would represent a significant change from the current status quo where we only see the negative outcomes published.