UK Affordability Checks: What We Know So Far

UK Affordability Checks: What We Know So Far

With the publication of the much-delayed White Paper now expected in January 2023, the talk between gambling stakeholders has once again turned to the subject of affordability checks. While many speculate about the upcoming regulations, it’s not all hot air. Across several leaks of information, delays, and swaps in the minister in charge, many details are already out.

Two systems, one customer

From what is already known, there will likely be a two-tier affordability check system that all UK Licensees will need to implement.

  • Tier 1: the lower tier will be for those who spend up to £125 a month and not more than £500 annually. It will involve a public inquiry to establish if debts are held.
  • Tier 2: the second tier is for players spending more (£1,000 in 24 hours or £2,000 in 90 days). It will involve a “more detailed consideration of a customer’s financial position” using a custom view back system/tool such as Open Bank.
  • Lastly, for new players, it is thought that anyone spending £500 in 24 hours in the first month or £1,000 in their first 90 days will be subject to review. Under 25s will also be subject to review whether they are a new player or have an established account. This recognises that 18-25s have been identified as the highest-risk age group for problem gambling.

Player and stakeholder reactions

There has been a significant industry and player backlash against the proposed checks, with players fearful of how invasive they will be. A YouGov poll commissioned by the Betting and Gaming Council has shown that 67% of gamblers believe that affordability checks would “risk driving players to the black market”.

Moreover, according to a recent article published in the Racing Post, players have reported they will not gamble if affordability checks are introduced. Others said they are uncomfortable sharing financial information with betting companies to the point they will not partake. This also fanned the flames of earlier BGC warnings that argue more restrictive gambling regulations drive more players offshore, increasing the risks and undermining the legal market.

However, not everyone is displeased; rather than taking opinions or Yougov poll data, we can look at Flutter Entertainment, which has got ahead of the game, implementing mandatory £500 monthly deposit limits in place for 18-25s in the UK and Ireland since September 2021. With the policy already a year into existence, Flutter Entainment has continually polled regular bettors across their brands and found wide-ranging support for the policy with 78% approval rates.

How will affordability checks affect the market?

According to A Select Committee on the Social and Economic Impact of the Gambling Industry report, 60% of industry profits come from only 5% of players who are already problem gamblers or are at risk of becoming problem gamblers. This stat denotes the unsustainable nature of the current gambling market and revenue sources and highlights the benefits of deposit limits for players.

While the industry is likely to take a large revenue hit, it is arguably rightly so and only in line with current licensees’ social responsibility commitments. However, as always, regulation must be proportional and evidence-led. What’s more, regulators must seriously consider how more regulation may increase offshore spending and how to target this unintentional side-effect of greater player protections.

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