White Smoke Rises
Whilst we await the selection of a new Prime Minister, we look in detail at the implications of leaked details from the White Paper on Gambling reform.
Welcome to the latest edition of Pinchpoint.
So, now we kind-of-really-know the UK government’s plans the gambling sector thanks to some comprehensive leaking to the Earnings+More newsletter.
We had heard that publication had been pencilled in for next Tuesday, but then the Daily Mail’s Tom Witherow broke the news that the government had decided this was an issue the next Prime Minister should deal with, so September it is. Or later.
Radical changes are unlikely, however, given the low ratio of votes to headlines in this policy area. So let’s go with this: if these leaks were to become the law, what will they mean for players, operators and society at large?
The Leak
In case you missed the E+M story, as far as affordability is concerned, the key points are that there will be two ‘tiers’ of affordability check that operators have to carry out:
The lower tier would involve secondary sources such as County Court Judgements to ensure a player doesn’t scream high risk.
The higher tier would involve “more detailed consideration of a customers’ financial position” using tools such as Open Banking.
The lower tier checks will be needed when a player has lost £125 in a month or £500 over the course of a year.
The triggers for the higher tier checks are more nuanced. They will be required for anyone who has spent £1,000 in 24 hours, or £2,000 in 90 days. New customers will have to be reviewed if they spend £500 in 24 hours in the first month or £1,000 in their first 90 days. Pinchpoint also understands that the under-25s will be subject to the new customer triggers regardless of how long they have been with an operator.
In addition, any player who wants to bet above the new “smart staking” level on a slot game (in the £2 to £5 range) will have to undergo higher tier checks. That’s right: you press that button to increase your spin and a chatbot could appear asking you to send in your bank statements first. This is not a good look and operators will doubtless have to get creative if it comes to pass.
The bottom line is that meaning affordability checks which involve actual financial data will soon become standard and normalised across the UK gambling market.
The End, or the Beginning?
As we see it, once the rules have been set, the industry will be able to embrace affordability in the way it previously did other forms of checks on players like ID verification.
Today’s revenue-draining friction caused by manual handling of sensitive data will be largely automated out, and the hesitancy of players to share data will also recede through familiarity with the process and more efficient ways of doing it.
An operator who spoke to Pinchpoint shortly after the E+M leak expressed what others are surely thinking: it’s probably overdue, but as the same rules will apply to everyone, they will learn to live with it. “It’s just the price of doing business”. Cheaper, one suspects, than the fines.
Passing on judgment
We’ve said before that setting the rules for affordability checks without defining “affordability” itself is like setting up speed cameras without saying what the speed limit is.
That makes this line in the leaked memo particularly intriguing: “It is not the government’s, the Gambling Commission’s, or the industry’s place to examine every facet of an individual's finances and make value judgments about what is and isn’t affordable.”
We read this to mean that affordability is not a judgment but a calculation. So long as a person’s gambling is funded from within their disposable income, it should be no one’s business but their own. The duty of operators will be to ensure that this is the case, and the responsibility (and expectation) of players is to allow them to so long as the information exchanged is no more than necessary. Players who fear operators using their bank data for other purposes, or who simply care about their privacy, can applaud this.
This seems to us to be the heart of the compromise that is trying to be struck here, and it is a worthwhile one if it can be achieved.
We’ll be back before the White Paper appears (ha ha). Until then, enjoy the heat, and the General Selection of our new PM.
About
Pinchpoint is a newsletter from Department of Trust and BetBudget.
The newsletter is published independently under the editorial supervision of Scott Longley of Clear Concise Media. Pinchpoint is not affiliated with any other publications.
We hope you find it useful and, as ever with these things, if you think any of your colleagues would be interested, then please feel free to share.
Contact
Charles Cohen, DoTrust: charles@dotrust.co.uk