The UK Gambling Commission will introduce Financial Risk Assessments (FRAs) through a staged implementation programme designed to help operators identify high-spending customers experiencing financial difficulties.
The regulator said the new process aims to improve how operators identify financially vulnerable customers while reducing reliance on document requests currently used by some businesses.
According to the Commission, evidence shows that high-spending gambling customers are between two and four times more likely to have a debt management plan and between two and five times more likely to have recorded a default in the previous 12 months than the wider population. Without intervention, these customers may continue to receive gambling promotions despite being financially vulnerable.
The assessments will be carried out using data provided by Credit Reference Agencies and will not require customers to submit documents or affect their credit scores. The Commission said the majority of customers will not undergo an assessment.
Pilot results found that 97% of customers exceeding the spending thresholds could be assessed without additional documentation, compared with the 80% estimate outlined in the 2023 Gambling Act White Paper. Less than 3% of accounts are expected to require an assessment, while fewer than one in 1,000 accounts would require further verification through methods such as open banking or document checks.
The first phase will apply to customers of the largest operators whose net deposits reach £5,000 over a rolling 24-hour period, a level the Commission said is exceeded by fewer than 0.5% of customers.
During the initial implementation period, the Commission said it will continue working with operators, Credit Reference Agencies and other stakeholders to refine the framework and develop guidance. It also confirmed that no enforcement action will be taken during the early stages solely because an operator fails to act on the outcome of a Financial Risk Assessment, although existing licence conditions will continue to apply.
Once the system is fully implemented, Financial Risk Assessments will apply to customers aged 25 and over with net deposits exceeding £1,000 over a rolling 24-hour period or £3,000 over a rolling 90-day period. For customers under 25, the thresholds will be £750 over 24 hours or £2,000 over 90 days. The Commission said a timetable for the first phase will be confirmed following further engagement with industry stakeholders.
Sarah Gardner, Acting Chief Executive of the Gambling Commission, said: “We are confident that our approach, using high-quality data, will enable support for high-spending customers in financial difficulties, while reducing friction for customers who are not in financial difficulties by removing the need for unnecessary and unpopular document checks to understand financial risk.
“We have listened to feedback throughout the pilot process which has led to us deciding to carefully proceed. We will work with key partners to make sure that they are implemented in the most effective way for consumers and operators.”
Gambling Minister Baroness Twycross said: “I welcome the Gambling Commission’s decision to implement financial risk assessments in a careful, phased way. Attention must now turn to successful implementation, so that financial risk assessments work for consumers, gambling operators and the wider ecosystem.
“The right balance must be struck so that assessments protect those in financial difficulties from the risk of gambling-related harm but do not create unnecessary burdens for the industry or consumers.”
Grainne Hurst, CEO of the Betting and Gaming Council, said: “We are deeply disappointed and frustrated that the Gambling Commission has decided to press ahead with Financial Risk Assessments despite the significant concerns raised over the last 18 months by the BGC, operators, racing, parliamentarians and customers.
“The fact that the Gambling Commission has delayed implementation, raised thresholds and abandoned its original timetable is a clear recognition that the concerns raised by the BGC and others were well founded. Unfortunately, the central issues around reliability, consumer impact and the practical operation of these checks remain unresolved.
“The Commission has failed to address the fundamental issues identified during its own pilot. It has not demonstrated that the data underpinning these checks is accurate, reliable or consistent enough to support regulatory decisions affecting customers.
“The pilot exposed inconsistencies in the information returned by credit reference agencies, with the same customer potentially receiving different outcomes depending on the provider. Customers risk being wrongly identified as financially vulnerable based on a system that remains unproven. That is not a sound basis for regulatory intervention.
“The Commission has yet to publish a full evaluation of the pilot, so neither the industry nor the public has seen the evidence needed to justify introducing these checks.
“These checks cannot be described as genuinely frictionless if they produce unreliable outcomes, lead to unnecessary account restrictions or ultimately result in customers being asked to provide documents or open banking information.
“While the Commission has announced implementation groups, it has given no indication that they will resolve the outstanding questions around reliability, consumer impact and how the system will operate in practice.
“We support evidence-led, proportionate regulation that protects vulnerable people while allowing the 22.5 million adults in Britain who bet each month to do so safely. But until the Commission can demonstrate these checks are accurate, consistent and genuinely frictionless, our fundamental concerns remain, including the risk of driving customers towards the growing illegal gambling market.”
