Gambling after a Credit Card Ban – What Are Your Options?

Posted by Harry Kane on Wednesday, March 13, 2019

Last year was a busy one for the UK Gambling Commission (UKGC), as the regulators looked to impose their vision of creating a safer and more transparent gaming environment online.

As part of this, the Commission announced it March that it would consider banning the use of credit cards on casino and betting sites throughout the UK. This followed a gambling authority report into the link between credit card use and the accumulation of debt through online gaming accounts, with up to 20% of all deposits made to casino sites completed using borrowed money.

While this highlights a potentially significant problem, it also underlines just how popular credit cards are among online gamblers. In this post, we’ll explore this further, while asking what options will remain available to players should credit card use be banned or restricted.

What’s the Issue with Credit Card Use?

In some respects, using a credit card to gamble may not seem like such a major issue. After all, credit card use is increasingly commonplace in the UK, with borrowing levels continuing to increase in January this year (despite annual growth in consumer credit falling to its weakest rate since October 2014).

An increased level of borrowing must be considered in a wider social and macroeconomic context, however, particularly with inflation continuing to increase at a disproportionate rate to real earnings in the UK.

In this instance, it appears as though people are increasingly using credit cards to make up for shortfalls in their disposable income levels, and this casts the current borrowing in an entirely different and unflattering light.

This observation formed the basis of the gambling authority report, which found that 55% of respondents had resorted to credit card borrowing in order to make ends meet in the previous 12 months.

Given this, and the fact that up to one-fifth of all online betting and gaming is done using borrowed capital, there’s a clear concern that credit cards are empowering potential problem gamblers to wager more than they can afford to lose in the current economic climate.

Most credit cards also allow players to gamble before they’ve been verified by a particular casino operator, with the existing rules stipulating that brands have a period of 72 hours to carry out the age and background verification checks on new registrants.

This allows ample time for players to register, credit their account with a Visa or Mastercard and gamble, regardless of their betting history or whether they’ve previously excluded themselves from betting through an independent scheme such as GamStop.

According to recent reports, vulnerable gamblers can circumnavigate this system simply by changing their user details, with their identity remaining unknown until the verification checks have been completed.

Fortunately, the UKGC has recently announced that they’ll introduce new laws to tackle this issue in May, primarily by prohibiting new players from gambling until the verification process has been completed. This will instantly safeguard vulnerable gamblers and make it easier for them to withdraw their winnings, while also incentivising operators to introduce more robust measures when confirming customers’ identity.

However, it has also been argued that banning or restricting credit card use would provide an additional layer of security for problem gamblers, by restricting their access to instant funds and making it harder to wager mindlessly.

Another issue is the variable credit limits associated with Visa cards and similar products, which can afford account holders large amounts of money to spend regardless of their financial circumstances.

According to a recent study by the Citizens Advice Bureau, more than one million people in financial difficulty have had their credit limits automatically raised by lenders.

This means that players are being given more to spend without further credit checks or safeguards, and this remains a considerable concern within the UKGC and among responsible gambling campaigners.

What Are the Chances of a Ban, and What Are Your Options?

For now, the UKGC is looking to clarify the data in the gambling authority report, while Culture secretary Jeremy Wright is scheduled to hold meetings with retail banks and gambling operators to discuss the industry’s reliance on credit cards.

The UKGC will then consider proposals and additional input from the Responsible Gambling Strategy Board, before deciding whether to further regulate the use of credit cards or ban the practice entirely.

A total ban seems unlikely at this juncture, particularly with the gambling authority suggesting that this may force vulnerable gamblers to seek out higher risk and higher cost alternatives such as payday loans. This is a serious concern and one that should compel the UKGC to regulate credit card use while making it an accessible option for players.

Either way, it’s fair to surmise that some players will turn away from credit card use in the future, and the question that remains is what are the best alternatives to this tried and tested payment method?

From a responsible gambling perspective, one of the best options is to use a prepaid credit card, which is typically sponsored by a major lender and loaded with a predetermined amount of cash at the time of purchase.

This instantly sets a limit on how much gamblers can spend, while they cannot be reloaded and used again once the funds have been exhausted. This sets them apart from other payment methods and makes them a viable choice for those aiming to reduce their bankroll in a sustainable manner.

If you’re familiar with cryptocurrency and hold some tokens, you may also want to consider using this to gamble with. After all, there’s only a finite amount of token available for each cryptocurrency (as they have to be physically mined online), and this makes it far harder to wager excessive sums through this method.

Cryptocurrency is also decentralised by nature, meaning that there’s no central authority or “middle man” to apply a transaction fee. This is diametrically opposed to how credit cards function, so you can reduce the cost of gambling and retain as much of your bankroll as possible.

You can also leverage so-called “stablecoins” to gamble even more efficiently, as these tokens are usually tied to a fiat currency (such as the U.S. Dollar) and are therefore not exposed to wild price fluctuations. This is great news for gamblers, who wager safe in the knowledge that the value of their bankroll will not vary hugely from one day to the next.

On a final note, you could use a trusted bank transfer to credit your account. While this may seem a little outdated and can take between three to five days to complete, it encourages you to think about your spending and places a cap on how much you’re able to gamble.