The Culture, Media and Sport Select Committee has called for further ironing out of finance risk checks in its report on the Gambling Act review White Paper, although it still remains supportive of the measure.
Finance risk checks are one of the key recommendations of the Gambling Act review, serving as the government’s answer to the long-running and hotly debated topic of affordability checks.
The measures seek to determine the extent to which customers are financially viable to gamble using monetary thresholds. When customers exceed these thresholds, they will have to share financial information to prove they can fund their gambling behaviour.
Published in April, the DCMS White Paper projected that only a minority of accounts, specifically those with high-levels of spending, would be impacted by checks. However, the CMS Committee MPs have called for greater clarity on customer data protection.
“While we support the principle of financial risk checks, the Government must ensure they are minimally intrusive, and that customers’ financial data are properly protected.
“The government and the Gambling Commission must also establish what level of “friction” involved in these checks is acceptable for most online gambling customers.”
Much of the talk around affordability checks has stressed the need for the measures to be ‘frictionless’, i.e. to impact the customer payments journey as little as possible. Operators in particular have been vocal about this, such as Kindred’s Tom Banks who spoke to SBC News last month.
The White Paper itself has acknowledged, however, that not all checks will be frictionless. This is particularly true in the case of the estimated 20% of accounts which will be subjected to ‘enhanced checks’.
In these cases, customers who have been flagged as displaying extremely problematic changes in gambling spend will be subject to financial checks via the sharing of data with third party Open Banking providers.
Customers not subject to Open Banking checks will instead have to provide payslips and bank statements – this is the option that is of most concern to operators, who worry that many customers will find this disagreeable.
Again, whilst welcoming finance risk checks as a player protection method, MPs have stressed the importance of non-intrusiveness, noting that up to 100,000 accounts could be subject to payslip or bank statement requests.
The Committee explained: “This is not an insignificant number, and it will be incumbent on the Government and the Commission to establish how financial risk checks can be made less “disagreeable” for these customers.
“Part of the answer will likely involve transparency on how customer’s financial information will be used and protected.”
In his statements to the Committee, DCMS Minister Stuart Andrew confirmed that a finance risk checks system could be piloted ‘if necessary’. In the Committee’s view, a pilot is essential.
A pilot should be overseen by the Gambling Commission prior to the implementation of a checks system, the MPs stressed, with the aim of determining “customers’ willingness to be subject to the checks, and whether they apply at suitable thresholds.”
As laid out by the White Paper in April, finance risk checks would see a monthly net loss threshold of £125, a yearly threshold of £500, and special cases of £1,000 in a day or £2,000 within 90 days.
A UKGC-oriented pilot, as requested by MPs, would likely evaluate the suitability of these thresholds and the mechanisms by which finance risk checks – whether through Open Banking, payslips or statements – are carried out.
Also central to the White Paper implementation, however, is the idea of a Single Customer View (SCV). This would serve as an aggregated system, based on customer data, showing an overview of all UK betting customers.
The UKGC has repeatedly cited the importance of introducing an SCV, and the CMS Committee agrees, stating that finance risk checks will only be effective when working across all online operators.
This would hopefully address the issue of a customer simply moving from one operator account to another once exceeding their financial thresholds. MPs have now called on the government to ‘set out progress in the work to develop’ the SCV mechanism.