ONLINE GAMBLING WITH THE CREDIT CARD LIVES ON!
A bill to outlaw credit card use in online gambling has fallen over after a senate committee deemed it the responsibility of gambling companies and banks to tackle the problem.
While gambling with credit cards is banned in casinos and pubs, online gambling with credit cards is still allowed. The result is disappointing for gambling experts and support groups.
A submission by consumer groups on the topic stated “Minimum monthly payments on credit cards can mean that a debt can be very costly and take many years to repay. A debt-fuelled gambling binge therefore can result in years of financial detriment. For example, spending $10,000 in a night of gambling could take 43 years and 11 months to repay and cost $36,3324 if only making the minimum monthly repayments.”
The fundamental argument of these groups, and SmartWayToPay is that while gambling always involves risk, gambling with money that isn’t yours and incurs interest is unlikely to be a decision ever made by a responsible gambler. This isn’t simple conjecture, there is plenty of supporting evidence.
A 2010 Productivity Commission report, released at a time when online gambling found problem gamblers were four times more likely to use a credit card, and were much more likely to have multiple credit cards, with one participant having 14 credit cards to gamble with totalling $300,000 worth of debt.
It’s even worse when you consider most credit card providers consider gambling spending differently to everyday purchases and charge high rates (up to 29.49% p.a.) and fees for them.
The ABA are requesting that any ban on accepting credit cards is the responsibility of betting companies, not themselves. This is despite the fact banks have unilaterally withdrawn banking services from a range of industries including payday lenders, adult stores, and some fintech businesses.
SmartWayToPay has always believed that the smartest way to pay for anything is with the money you have. To support a gambling habit with credit cards is extremely risky. SmartWayToPay spokesperson, David Liston today commented on the failure of the senate committee:
“Banning online gambling via a credit card is a no brainer. It’s hard to view that kind of behaviour to be ever considered responsible. I would expect banks to take the lead now and restrict its use.
“To leave gambling companies in charge of addressing this issue is like leaving the fox in charge of the henhouse.
“The Buy Now Pay Later industry has never allowed gambling, and it’s new Code of Practice explicitly prevents buy now pay later from being used for gambling. Why is it possible for the Buy Now Pay Later sector to block gambling but not the banks? Why should the Banks not have responsibility for this?”