𝓤𝓷𝓲𝓽𝓮𝓭 𝓝𝓮𝔀𝓼

The Gambling Commission has confirmed proposals to introduce financial risk assessments on high-spending online gamblers, beginning with those who deposit £5,000 over 24 hours.

The checks, first set out in a 2023 consultation linked to the Government’s Gambling Act Review, would involve a “frictionless, document-free assessment” provided by Credit Reference Agencies, with no impact on a customer’s credit score, it said.

The Financial Risk Assessments (FRAs) are to be introduced in stages to identify customers in financial difficulties and streamline and improve operator processes.

The regulator said there was evidence that some high-spending customers were experiencing current financial difficulties, but were not being identified or supported by gambling businesses.

The first stage of implementation will see FRAs carried out by the largest operators, where there is high spend of multiple thousands of pounds over a 24-hour period.

For most, this would mean a £5,000 net deposit over a rolling 24-hour period, “which is a very unusually high spend pattern that less than 0.5% of customers exceed”, the commission said.

Once fully implemented, FRAs will be applied to customers aged 25 years or older with net deposits exceeding £1,000 in a rolling 24-hour period or £3,000 over a rolling 90-day period.

For those under 25, these thresholds will be reduced to £750 in a rolling 24 hours or £2,000 in a rolling 90 days.

The regulator insisted the measures were not “affordability checks” and would not cap spending or assess income, but instead act as a prompt to identify customers in serious financial distress.

It said high-spending customers were between two and four times more likely to have a debt management plan and between two and five times more likely to have a default in the previous 12 months than consumers in the wider population.

It raised concerns that without being identified, they could continue to receive marketing and promotional offers encouraging further gambling despite being financially vulnerable.

It reassured consumers that the “vast majority” of customers would never need an FRA, and those who placed an occasional bet, were a recent winning customer or even regularly spent hundreds of pounds would be unlikely to need a check.

The commission said a pilot found that 97% of those spending above the threshold levels could be easily and frictionlessly assessed for financial difficulties, meaning that less than 3% of accounts would have an assessment and less than one in 1,000 accounts would be unable to get one.

For those one in a 1,000 accounts, operators will have to properly verify identity and may have to assess financial risk through other means such as open banking or requesting documents.

The commission confirmed that no enforcement action will be taken on a failure to act following an FRA during the early stages of implementation, although operators are still subject to all other existing licence requirements.

It said it will confirm the timetable for stage one following engagement with industry and other stakeholders through implementation groups being established over the summer.

Before the current proposals, operators only had to run basic checks using public data, such as bankruptcy records when customers deposited more than £500 in a month – later cut to £150 – with no routine use of credit reference data for higher-spending gamblers.

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.”