Lenders welcome move to ban credit cards for online gambling

The change will amend the Interactive Gambling Act 2001, making it illegal for an online gambling company to accept a credit card online.  

The legislated ban would mean that online gambling would fall under the same rules as land-based gambling (which already bans the use of credit cards).

While draft legislation and details on the technical implementation of the ban are yet to be released for consultation, it is believed that the ban will work by using bank identification numbers (BINs) to identify and block credit card payments at Australian licensed wagering services.

Lottery services, including those offered by charitable organisations, will be excluded from the ban. The government suggested this was because they present a “low-risk to gambling harm”.

BIN blocks are already used by casinos and poker machine venues to stop credit card withdrawals from ATMs. A similar move was used in the UK to implement its own credit card ban for online gambling.

Announcing the ban on Friday (28 April), the federal Minister for Communications, Michelle Rowland MP said, “legislating a ban on the use of credit card for online gambling will help protect vulnerable Australians and their loved ones”.

Indeed, Australia is believed to have the highest gambling losses per adult in the world, at around $25 billion a year.

The Australian Institute of Family Studies recently estimated that 7.2 per cent of Australians are already experiencing — or at risk of experiencing — gambling harm; the impact of which typically extends to around six others, including family and friends.

Speaking of the proposed credit card ban for online gambling, Ms Rowland said: “It’s as simple as this: people should not be betting with money they do not have.”

The Minister for Social Services, Amanda Rishworth, added: “The Albanese Labor Government is committed to creating a better Australia. Minimising the harm caused by problem online wagering is a key part of achieving that goal.

“Importantly, minimising this harm is not a set-and-forget exercise. Bringing online wagering into line with land‑based gambling, where credit cards cannot be used, is another positive step.”

She added that the latest move by the Albanese government would “help Australians who are vulnerable to harmful online wagering”.

It is anticipated that legislation to amend the Interactive Gambling Act 2001 will be introduced later this year. The Australian Communications and Media Authority (ACMA) will receive enhanced powers to enforce the ban.

“We’ll now look to what’s next, along with our state and territory colleagues,” Ms Rishworth added. 

The government is also seeking agreement from the states and territories to introduce mandatory minimum classifications for computer games with gambling-like features.

ABA welcomes proposed ban

The Australian Banking Association (ABA) has welcomed the federal government’s announcement to ban the use of credit cards for online gambling. 

A recent survey by the Australian Banking Association found that 81 per cent of Australians believe gambling with credit cards should be restricted or banned, with over half (54 per cent) stating their use should be banned altogether.

ABA chief executive Anna Bligh commented: “The ABA has advocated for a number of years for consistency regarding the use of credit cards for gambling and strongly welcomes the federal government’s announcement (on Friday [28 April]) to ban credit cards for online gambling. 

“Using credit cards for gambling can create a unique harm where large amounts of debt can be accumulated in a short period. For people with a gambling addiction, a credit card can lead to severe financial stress for the individual and their family.  

“The online gambling credit card ban will go a long way to help people experiencing gambling harm to keep control of their finances.”

Ms Bligh said that it was an “absurd reality” that credit cards are still allowed for online gambling while credit cards were banned for gambling in hotels, clubs, casinos, and TAB outlets by state and territory governments in the early 2000s.

She flagged that this meant that “someone cannot use a credit card at the betting counter at a TAB outlet or pub but can sit at the same outlet and gamble on a betting app using a credit card”. 

“The overwhelming majority of Australians will applaud this decision. A survey commissioned by the ABA in 2020 showed 81 per cent believe there should be restrictions on using credit cards for gambling, with over half (54 per cent) stating their use should be banned altogether,” Ms Bligh said.

Ms Bligh said Australian banks had already introduced a set of tools to help customers manage their gambling use, including technology to track and cap gambling spending, provide real-time alerts and initiate customer-directed blocks.  

Some banks also offer low or no-interest credit card products that do not allow gambling transactions.

The House of Representatives standing committee on social policy and legal affairs is currently conducting an inquiry into online gambling and its impacts on those experiencing gambling harm, which will reportedly inform the government’s future response.

[Related: CBA fined for lending to problem gambler]