Britain’s 24 million gamblers will no longer be able to use credit cards to place bets under the latest move by the government to tackle problem gambling.
Less than a year after Britain slashed the maximum stake that can be placed on popular fixed-odds betting terminals, it said on Tuesday it would ban gamblers from using credit cards to bet online or offline to rack up debt.
According to trade body UK Finance, around 800,000 Britons use credit cards to gamble. The Gambling Commission believes a quarter of those are problem gamblers – people who are addicted to gambling to try and win back their losses.
Shares of betting companies including 888 Holdings, Flutter Entertainment and William Hill dropped in early trading, before recovering by late morning.
Culture Minister Helen Whately said there was clear evidence of harm from consumers betting with money they don’t have.
“We will not hesitate to take any further action necessary to protect people from gambling harm,” she said in a statement.
Britain has a thriving gambling industry. It employs more than 100,000 people and made 14.4 billion pounds ($18.7 billion) after paying out winnings in the 2018-2019 financial year.
But the government has sought to tighten rules in recent years by capping the maximum stake on terminals, bringing in tighter age and identity checks for online gambling and expanding support for those who become addicted.
The new ban will come into effect on April 14 and apply to all online and offline gambling products apart from over-the-counter lottery tickets.
Davy Research analysts said the ban would likely lead to a low single digit percentage drop in related revenues.
“The latest in a recent series of more onerous regulatory changes, it also acts as a further reminder that the UK opportunity is no longer what it once was,” it said in a note to clients. “However, it remains a very large, (still) growing and highly cash generative market for online gaming operators.”
Britons had a total of 72.1 billion pounds outstanding on credit cards in November, according to Bank of England data, down a little from a record 72.9 billion pounds struck in May.