Who really benefits from the ban on credit cards in casinos

When governments impose a ban on the use of credit cards in casinos, there is only one argument: they say, this is necessary to protect players from debts and impulsive bets. But the reality, as usual, is much more prosaic - players find an alternative, and operators are only grateful. Let's figure out why the ban on credit cards does not change almost anything, except for the convenience for business.

Players don't stop borrowing — they just change the source

After the UK banned the use of credit cards for betting in the spring of 2020, there was no particular tragedy in the mass segment. Ordinary users simply switched to debit ones - they used to replenish the balance before. But those who play with money on credit continued to do so, but no longer through a bank, but through microfinance organisations.

The regulator, by the way, confirmed this trend itself: about 75% of gambling addicts immediately turned to MFIs to take out new loans. As a result, over the year after the introduction of the ban, the share of deposits with attracted funds increased from 6% to 8%. That is, the ban did not reduce the risks in any way, but only transferred players from the banking zone to at least some responsibility - to the world of predatory loans with interest rates of 300% per annum.

MFIs do not care that the client has gambling problems. They don't care what you take out a loan for - the main thing is that you pay it back on time. If it doesn't work, welcome to the world of collectors and lawsuits.

For casinos, the ban has even become convenient

In the online gambling industry, the ban on credit cards unexpectedly turned out to be not a punishment, but almost a gift. Firstly, the number of chargebacks — refunds when a player declares to the bank that the transaction was dubious — has decreased. When paying with a credit card, the refund often worked, especially if the player lost and began to complain. But with loans through MFIs or transfers from a debit account, such a trick no longer works.

Secondly, credit cards initially do not fit into the gambling infrastructure in the best way. As consultant Andrew Tottenham of Tottenham & Co (I wonder which club they support?) explains, a credit card is a one-way tool: pay and forget. And casinos are a two-way process: deposits and withdrawals. When someone requests a withdrawal to a credit card, the bank may regard it as a refund for the purchase, which causes additional checks, bugs, and delays.

The ban does not solve the problem of addiction – it only masks it

It would seem that the ban on credit cards should at least reduce the number of players who play on credit. But as a result, the opposite effect is obtained: debts do not disappear, they just become less visible and less manageable.

Banks at least fix the credit burden - they have tools for assessing solvency, limits, protection mechanisms. And microloans work on the principle: "Do you want money? Hold on. If you don't return it, we'll knock it out." And there is no verification, analytics, control over the level of the debt pit – just a new entry point into the same dependence, only with a more aggressive collection policy.

Inference

Banning the use of credit cards in casinos sounds like a security measure. In fact, it is a cosmetic solution that:

• does not reduce the number of problem gamblers;
• does not limit loans for gambling;
• makes it more difficult for regulators to monitor debts;
• makes life easier for operators by reducing chargebacks and simplifying payment logic.

On the other hand, casinos are deprived of problems with chargebacks and withdrawal of winnings to credit cards. So if you are a casino owner and a ban on credit cards has been introduced in your geo, you don't have to be upset