Blocked by the bank: Helping hand or troubling precedent

Banking, uk high street, betting, credit cards
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With high street banks taking on some of the responsibility for blocking problematic payments, and the government looking into a ban on betting with credit cards, we ask whether this gives succor to a sector struggling with self- exclusion, or signals another small step towards controlling how consumers spend their cash.

The responsibility to reduce problem gambling is often asymmetrically laid at he feet of gambling operators. But increasingly banks are taking it upon them- selves to block their own customers’ payments to gambling services – if they have requested help with problematic behaviour.
A string of so-called “challenger banks” – such as Monzo and Starling – began to offer their customers the ability block their own payments last year. These were later joined by Barclays and more recently Santander, Halifax, Lloyds and Bank of Scotland.
Given the various complications firms face in tackling the issue, most recently felt by GamStop – the industry-owned scheme understandably struggling to achieve its goal of allowing bettors to self-exclude across the entire UK market (see UK, page 10) – these initiatives come as a welcome pillar of support.
For David McLeish, partner at Wiggin, it is possibly even a little over- due. “The government has really focussed on gambling operators, per- haps without thinking outside the box on this,” he said.
The UK industry has taken “great strides in terms of responsible gam- bling”, and “this isn’t recognised enough”, he added. “But the fact that others in the supply/financial chain can take steps to support these initiatives should be welcomed.”
Analysts at Regulus Partners held a similar view, writing that bank account blocking “complements a growing array of services and tools developed by gambling operators the traditional supply chain and specialist safer gambling companies.”
Although: “developing these tools is one thing; persuading people to use them is quite another; and normative framing seems like a more promising route than the public health lobby’s scare tactics. The next task is surely to work out how all these tools and controls interlink.”
And therein lies the potential problem for the industry. At the moment, these initiatives are voluntary, adopted by banks at the behest of their customers, and in response to their own regulatory pressures. But if such a scheme were to become mandatory, and tied across gambling and banking sectors, it begs the question of who gets to decide which payments get blocked, and which don’t. Today it’s consumers – but in the current febrile feelings- first policy environment, that itself could be subject to change.
“My view is that such tools are a great help to those that wish to curtail or stop their gambling addiction,” says Warwick Bartlett, CEO of the Isle of Man based consultancy firm, GBGC. “But we have to be careful not to cross the line and prevent those that do not have a gambling problem from gaining access to their chosen gambling website – for 99.3 percent of people gambling is a normal pastime.”
“The banks are under constant pressure these days to avoid the horrendous fines that have been levied upon them. What is a concern to me is the way governments are using the banking system to regulate behaviour as opposed to legislation that would be unpopular and a vote loser.”
The latest push from both government and the Gambling Commission is for the mandatory blocking on the use of credit cards to place bets or wagers online; a modest proposal perhaps, but if a recent survey – that shows up to one in five bets are placed this way – is anything to go by, it could have a significant impact on revenues.
McLeish tempers, it’s “generally felt that social responsibility initiatives have reduced the prevalence of this.” But for the government to start telling people what they can and can’t spend borrowed money on, would already represent the crossing of a major rubicon in terms of consumer freedom.
“Regulation is a good thing,” Bartlett reminds. “But too much regulation is harmful and governments the world over are now having an overbearing influence on people’s day to day lives.”
In the meantime, David Clifton, director of licensing consultancy firm, Clifton Davies, warns that no one should be taking this added assistance from banks as an easing of their own regulatory commitments to monitor problematic behaviour.
“I don’t see this development leading to any alleviation of compliance obligations on the part of gambling operators,” he explains. “They will remain bound to promote the licensing objective of protecting the vulnerable and to comply with all of the LCCP obligations associated with that.
“In my view, only a foolhardy operator would approach this on the basis that it could provide some cost-saving from a compliance perspective.”


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