Who’s Most at Risk of Becoming a Problem Gambler

Posted by Harry Kane on Tuesday, January 18, 2022

When the UK Gambling Commission (UKGC) first unveiled its report into VIP gambling at the beginning of 2020, it revealed that the market’s leading firms were incredibly reliant on high-stakes players. Incredibly, it found that one anonymous operator took 83% of its total deposits from just 2% of its player base, with this raising concerns about problem gambling and the sustainability of the UK marketplace.

Further research has found that of the 47,000 VIP players in Britain, up to 8% of them may be problem gamblers. This is 11-times higher than the rate amongst the general public, highlighting a key demographic that the commission will need to safeguard going forward.

This problem was met with a clear response by the UK Gambling Commission (UKGC), who imposed new rules pertaining to VIP schemes and demanded more stringent affordability checks on qualifying players and participants.

This action was enough to ensure that no further action will be taken against such VIP schemes and incentives as part of the upcoming Gambling Review in the UK. In this article, however, we’ll look at the demographics most likely to include problem gamblers, and whether you’re really more likely to develop compulsive behaviour if you’re poor or economically disadvantaged.

A Look at the Numbers – Are Poorer Players Really at Risk?

According to recent research carried out by the University of Liverpool and the National Centre for Social Research, gambling brands currently generate at least 70% of their revenues from the biggest losers. While this includes VIP gamers, it also draws from a wider subset of players including the vast majority of less well-resourced players who also wager frequently online.

In the sports betting niche, this rises to a worrying 86%, while people who reside in economically deprived areas are increasingly likely to be included in this demographic.

The reason for this is simple; as people in deprived areas of the UK are statistically more likely to frequent online casinos and place risky, long-odds wagers in the pursuit of large and potentially life-changing returns, meaning that they’re often among the 5% of accounts that rack up the most significant losses.

If we drill deeper into this, we can see that while nine out of 10 online casino accounts either won money or lost less than £500 over the course of a year, 164,000 lost more than £500 during a single session of play alone. Once again, not all of these will be VIP players, with this particular demographic including a vanishingly small number of representatives.

At the same time, an estimated 47,000 people lost more than £5,000 in a single year, with this group disproportionately likely to come from an economically deprived area in the UK.

Interestingly, the majority of this number will have lost money on virtual slot games, which historically carry a considerably higher rate of addiction due partially to the multi-sensory experience that they provide and the use of fun and engaging visual themes. Historically, these have made it hard for players to disengage from slots and manage their bankrolls successfully, while the deployment of autoplay features also enabled individuals to commit to multiple spins with a single push of the button.

Of course, the UKGC has since made it unlawful for slots to feature autoplay buttons or features that distort the gameplay experience for players, but some slots (which can allow players to stake as much as £500 per spin) continue to pose a problem from the perspective of disproportionate gambling losses.

What Does This Mean in the Marketplace?

In total, slots accounted for more than half of losses above £5,000, and 70% of sessions where players were active for three hours or more without taking a break.

What’s more, in excess of 14,000 accounts did this at least three times during a single year, creating the potential for sizable losses amongst those who simply cannot afford to sustain them over any prolonged period of time.

This is perhaps why the All-Party Parliamentary Group (APPG) for Gambling Related Harm has proposed capping online slots wagers at just £2, while simultaneously suggesting a monthly spending cap for players of £100 as part of the Gambling Review. Widespread affordability checks could also be implemented to ensure that even lower spends are betting outside of their means, and while this has been opposed by industry leaders, it could help to protect poorer players who regularly wager outside of their paltry means.

There has been some contention about whether the latter measure will be rolled out, while the online slots’ betting cap could actually be as high as £5 depending on the final outcome of the Gambling Review. Regardless, these measures could ultimately catch poorer players and potential problem gamblers that would otherwise have fallen through a virtual net, benefitting them but arguably diminishing revenues considerably.

To spend beyond this, players would have to undergo potentially stringent affordability checks that could resemble de facto credit checks, and while this has yet to be confirmed, it may dictate a bespoke spending limit based on each individual player’s earnings and existing financial resources.

Fortunately, iGaming operators already boast huge swathes of customer data in this respect, which can be used to set intuitive limits that safeguard individuals at all times. This makes the process relatively easy, though the potential losses in revenue and profitability could prove harder for even established operators to absorb.

The Last Word

Ultimately, the Gambling Review could help to safeguard those at risk of problem gambling, including both VIP players and high rollers and those who wager less but have fewer resources and live in economically deprived regions of the UK.

However, the market is already set to see its cumulative GGY impacted negatively as a result of the impending review, and this could fall further if poorer customers are also discouraged from gambling over time.