Mixed reception as Gambling Commission unveils affordability pilot scheme in consultation response

The BHA has insisted how "vital" it is that the majority of punters who bet safely are not impacted by affordability checks after the Gambling Commission issued further details of its plans to a mixed reception on Wednesday.

A six-month pilot of enhanced affordability checks will be launched at the end of August, with the commission claiming they will not be formally introduced until they are frictionless for the "vast majority" of customers who are checked.

The news comes as the gambling industry regulator set out its long-awaited response to the consultation it ran on affordability checks, or financial risk checks as they have been termed, last year.

It also follows the announcement of a new interim gambling industry code developed by the Betting and Gaming Council (BGC) and Gambling Commission, which is aimed at reducing the number of punters being asked for personal financial documents to prove they can afford their level of betting under the current ad hoc system of checks, which will run until a new frictionless regime is brought in.

Affordability checks

• New code on affordability checks is a hard-won victory, but concerns remain 

• Explainer: how the new interim code for affordability checks will work in practice 

Checks are to be introduced in two stages. Initial proposals in the government's white paper had set a first tier of financial vulnerability checks at £125 net loss within a 30-day period or £500 within a year.

However, in the plans set out by the commission, that will change to those checks happening for customers with a net deposit of more than £150 a month on gambling, focusing on publicly available data. The checks will initially come into force at £500 a month from August 30 before reducing to £150 a month from February 28 next year.

For enhanced checks the commission said it would carry out a pilot from the end of August, working with credit reference agencies and gambling businesses, and would examine potential consumer impact. The pilot is intended to last for six months with some additional time for reporting the results but could be extended to the end of April next year.

Initial proposals also set thresholds for the second tier of checks at losses of greater than £1,000 within a rolling 24 hours or £2,000 within 90 days. However, following the pilot the commission said it would explore "the exact financial thresholds the assessments would be conducted at".

• Watch: Gambling minister Stuart Andrew on plans for affordability checks
  

Gambling Commission chief executive Andrew Rhodes said: "We have listened to the views expressed in our engagement and in the consultation responses, and we have made changes while still ensuring that we deliver meaningful protections."

Following the pilot, the commission will decide whether permanent rules should be implemented in 2025 Rhodes added: "This will not be done until the data-sharing is frictionless for the vast majority of customers who are checked."

Punters will not be affected during the pilot period, which will test the different forms of data that will be used to inform a customer's risk assessment, such as the information credit reference agencies could share without customers needing to submit financial documents.

BHA chief executive Julie Harrington said the commission's response would help bring "some much-needed clarity for horserace bettors".

It followed intense campaigning by racing and its followers for what Harrington described as "a more measured and proportionate approach" to implementing the proposals set out in the government's gambling white paper.

Harrington said she was encouraged by the pilot and that it was a positive step that operators would not have to consider an individual’s postcode or job title.

She added: "However, we would like to understand more about the detail of the implementation of these checks to ensure they are proportionate and can be shown to effectively target those who exhibit markers of harm.

"It is vital they do not impact the vast majority of customers who bet in a way that does not cause any harm."

Racing's leadership has claimed affordability checks already implemented by bookmakers have reduced online betting turnover on racing by hundreds of million of pounds and has estimated that affordability checks could wipe a further £250 million from the sport's revenues over the next five years.

Harrington added: "As such, we look forward to working with the Gambling Commission as the enhanced checks pilot is implemented to ensure that racing is not further adversely financially affected."

On the enhanced checks, culture secretary Lucy Frazer said in a ministerial statement that the consultation response made clear that enhanced risk assessments would only be introduced at the point government was certain they would be frictionless.

She added: "The pilot will be used to test the best data to use and how operators and credit reference agencies will share this data. Credit reference agencies collect a range of data that could be used in an assessment, for example information on missed or late credit payments or how much credit is available.

"Gambling operators will never have access to raw account-level data, and so, for example, they would not be able to look at customers’ bank accounts and nor will the government or Gambling Commission. The pilot will also assess the impact these risk assessments will have on the industry as well as consumers."

The announcement of the pilot scheme, as well as the launch of the interim code, received a mixed reception from politicians, including Conservative peer Lord Herbert of South Downs, who said: "I think it deserves one cheer but certainly not three. It’s only a step in the right direction on affordability checks, they’ll still bite on wealthier punters and it would have been far better to exempt racing altogether.

"We still haven’t seen action on the levy and it’s now doubly important that this is increased and extended to bets on overseas racing. Many of us had hoped to see a stronger package of measures and if the levy reform isn’t delivered I think it will be a bitter disappointment to the racing industry which frankly has not been treated well."

The BGC welcomed the consultation responses and a spokesman said the industry body would take time to consider the impacts on its members and their customers, before adding: "The BGC has consistently called for frictionless financial risk checks, targeted on those at risk, while not unnecessarily impacting the vast majority of punters who bet safely and responsibly."

Read this next:

Gambling Commission chief Andrew Rhodes: I can understand privacy concerns but difficult choices have to be made over checks 

Gambling Commission confirms plans for six-month pilot of 'frictionless' affordability checks 

BHA chief Julie Harrington encouraged by interim gambling code but stresses concern over levy review uncertainty 

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