Over approximately the last 20 years, Australian punters have been prohibited from using credit cards for cash advances in pokie lounges and casinos. Online gambling is, however, free from this restriction and punters are free to use their credit cards as they wish.
This issue has made an appearance in the public arena numerous times over the years, normally as the result of politicians adding the topic to their agendas. The voices in support of and opposition to the practice have re-emerged to do battle once again.
Fighting for change
Queensland MP Andrew Wallace re-ignited the debate recently when he called for a ban on the use of credit cards for online gambling. In his words, the banks have a “social responsibility” regarding this issue and he pushed for them to establish a voluntary code of conduct. The objective of this would be to prohibit online gamblers from betting with funds borrowed from credit card companies.
Wallace called his solution a “no brainer,” and further stated, “We know that people pay 22% or thereabouts in interest on their credit card balances; that’s a very dangerous mix.”
He wrapped up by saying, “You can’t use a credit card to go into a TAB and gamble on the horses or the dogs. You can’t use a credit card at a casino, and you can’t use a credit card to gamble on the pokies.”
Status quo champion
The gambling industry expectedly does not hold the same opinions as Wallace. Measures against credit card use in online gambling represent a threat to the profitability of gambling organisations and the industry also argues against the limitations to personal freedoms in this respect.
Brent Jackson, the CEO of Responsible Wagering Australia, a lobby group that major industry players like Sportsbet, Ladbrokes, Neds, and Bet365, is a prominent voice of support in favour of maintaining the current practice.
Jackson’s stance is that punters generally behave responsibly and that the minority who are problem gamblers are offered assistance on an individual basis. He also put forward that punters have the right to enjoy the full freedom of managing their betting preferences. On the subject of how specifically casinos approach problem gambling, he stated,
“They [online casinos] do keep an eye out specifically for unusual behaviour and strange behavioural patterns and activity that is not considered normal and might be risky. “We can take a number of interventions aside from banning them completely, we often contact customers directly as this is happening.”
He added that there is no evident crisis that justifies such a drastic intervention and that online gambling is safer than visiting land-based casinos or pokie lounges because of the strict legislation and live monitoring of gambling behaviour.
An inert ABA
Towards the end of 2019, the Australian Banking Association (ABA) surveyed its members to ask whether credit card usage should be banned on gambling apps. Eighty-one percent were in favour of restrictions or a total ban, 12 percent were undecided and the remaining seven percent were against restrictions of any kind.
The ABA characterised gamblers as “vulnerable customers.” However, the association has failed to make any decisions on any kind of overarching policy. This is mainly due to concerns that their actions in this respect could represent a violation of anti-competition laws.
The Australian Competition and Consumer Commission has stated that it is willing to grant an exemption in this case as it sees this as a crucial public issue. The commission has previously shown support for banks implementing voluntary conduct codes.
Despite all of this, the ABA seems mired in indecision with some speculating that its inaction is due to cowardice or greed. In the meantime, Aussies are increasingly creating up new betting accounts and the segment that has shown the biggest growth is the 18 to 34-year-old group.
Sportsbet reported a 108% increase from April to June in 2020 following COVID-related shutdowns, resulting in their profits skyrocketing from $96 million to $191 million.
