It’s no secret that problem gambling is a widespread issue within the UK, with GOV.UK reporting that it has a direct financial cost equivalent cost to £412.9 million and a cost to society between £635 million and £1.3 billion. Therefore, it comes as no surprise that the UK Gambling Commission has announced much-needed updates to its regulatory framework, putting consumer protection in the gambling industry at the fore.

The UKGC’s new rules coming into effect in 2025 require online gambling operators to carry out more in-depth financial vulnerability checks and equip themselves for effortless and future-proof financial risk assessments. These changes are designed to promote safer gambling practices by enhancing consumer protection, fairness, and transparency. It is therefore crucial for gambling operators to proactively work towards preventing gambling-related harm.

Though the regulatory changes will pose some difficulties, they offer a chance to adopt more responsible practices. Fully grasping the implications of these new regulations and the wider issue of gambling addition will allow operators to navigate the shifting landscape, maintain compliance, uphold ethical standards, and foster continued customer trust.

Understanding the New Rules

The UKGC’s latest updates, introduced as part of a phased review of the Gambling Act 2005, implement key measures designed to enhance consumer safety in the online gambling industry. These regulations highlight the Commission’s continued commitment to safeguarding vulnerable individuals and mitigating gambling-related harm, particularly in the fast-expanding online sector.

There are three significant policy changes:

1. Financial Vulnerability Assessments: Remote operators are now required to perform financial vulnerability assessments when customers spend £500 on gambling within a 30-day timeframe. These assessments utilise publicly accessible data to determine if a customer might be at risk of gambling beyond their means. The UKGC’s goal is to pinpoint financially vulnerable customers before they incur substantial harm.
2. Frictionless Financial Risk Assessments Trials: The UKGC is testing seamless financial risk evaluations for the largest remote operators. This initiative enables operators to evaluate customers’ financial well-being without disrupting their gambling experience. The aim is to establish a system that safeguards consumers while minimising interruptions, ensuring that safety measures do not adversely affect responsible gamblers.
3. Additional Regulations on Game Design and Advertising: Alongside financial assessments, the UKGC will implement new regulations concerning remote game design in January 2025. These guidelines aim to make games less addictive and mitigate the risk of problem gambling. Furthermore, updates to direct marketing regulations, set to take effect in May 2025, will empower customers to have increased control over the marketing communications they receive from gambling companies.

These updates clearly demonstrate the UKGC’s commitment to enhancing gambling safety by focusing on financial vulnerability, addictive game design, and excessive marketing – all key factors that are known to contribute to problem gambling. The industry must get behind the Commission and its measures to help reduce the risks faced by vulnerable players.

The Repercussions of Problem Gambling

According to the latest statistics from the Gambling Commission, 0.5% of the adult population has a problem with gambling, making it one of the UK’s most pressing issues. For individuals with gambling addictions, betting can lead to several major life issues, including financial hardship, mental health issues, and damaged relationships.

Financial vulnerability is a major factor that can aggravate gambling addiction. Whilst gambling and online gaming can appear as a quick fix for those who are already struggling financially, it can often lead to even greater debt and hardship. Therefore, UKGC’s focus on financial vulnerability is vital – it targets this issue at its roots by encouraging operators to intervene before a customer’s gambling spirals out of control.

Another factor that plays a huge role in problem gambling is game design. Fast-paced games that offer frequent wins or incorporate mechanisms such as near-misses can hinder players’ ability to quit. The new regulations on remote game design are set to address these addictive features and enhance consumer safety.

What Gambling Companies Can Do to Stop Problem Gambling

Given the UKGC’s new regulations, it’s evident that online gambling companies must adopt a proactive approach to prevent problem gambling. Merely complying with the updated rules is not enough; operators need to exceed the minimum legal standards to genuinely protect their customers, including:

1. Enhance Financial Monitoring: The UKGC’s updated financial thresholds highlight the necessity of understanding a customer’s financial well-being. Operators should invest in tools that facilitate real-time assessments of customers’ ability to engage in gambling responsibly, intervening when needed. This includes providing resources like deposit limits and self-exclusion options to help customers manage their spending.
2. Encourage Responsible Gambling: Operators should actively foster responsible gambling habits among their customers. This can involve regular reminders of betting limits, offering cooling-off periods, and making it easy for users to access information on safe gambling practices. Clear communication regarding the risks associated with gambling and available support services can play a crucial role in preventing harm.
3. Create Safer Game Designs: The newly introduced regulations on game design offer an opportunity for operators to evaluate their offerings and ensure they do not promote addictive behaviours. By reducing immersion and minimizing features that encourage continuous play, operators can help prevent customers from developing gambling-related problems.
4. Ensure Transparency in Marketing: With new direct marketing regulations set to take effect in 2025, operators must communicate transparently and respectfully with their customers. This includes allowing customers to control the marketing materials they receive and ensuring that promotional content does not encourage excessive gambling.

A ‘Safer’ Approach to Betting

With the evolving regulatory landscape, online gambling operators are tasked with finding effective strategies to meet stringent requirements while prioritising customer protection. Technology plays a key role here – yielding operators with comprehensive tools to conduct financial vulnerability assessments, evaluate gambling risks, and ensure compliance with UKGC regulations.

Through the latest technology operators can generate secure consent links to access a customer’s financial data. Once granted permission, this type of system connects to the customer’s bank, finding real-time data on their income, affordability, and gambling history. This information is analysed to provide actionable insights into a customer’s financial situation, aiding operators in meeting the £500 threshold checks and identifying at-risk customers early.

Additionally, streamlined financial risk assessments allow operators to integrate outside solutions into their platforms through intuitive APIs. This allows for thorough financial evaluations without compromising the customer experience.

In this regulatory climate, it’s imperative for gambling operators to adopt solutions that not only ensure adherence to laws but also promote responsible gambling. Technology that empowers operators to meet compliance standards, protect their customers effectively, and foster the trust that is vital for sustained growth and success.

To learn more, visit: https://www.aperidata.com/

About the author / spokesperson

Andrew Bonsall is COO at AperiData.

Andy’s a credit risk entrepreneur with 25 years of global experience in the banking and software industry. He has vast experience working for Tier 1 banks and global software, scoring and data providers worldwide with a particular focus on Europe, the Middle East and Africa.

Andy and Steve Ashworth (CEO of AperiData) have worked at a lot of places together and celebrate a long history of success. They know what works and what needs to change in the industry. Together they formed a special team at AperiData doing world changing things.

Prior to AperiData, Andrew co-founded 10x Consulting Ltd in 2013 while also completing a variety of Credit & Risk positions across leading brands, Lloyds Banking Group, FICO, GE Money and Bank of America.

About AperiData.
An industry challenger harnessing the power of Open Banking, AperiData is laser-focussed on facilitating instant, accurate and fair outcomes for consumers and financial institutions. Authorised and regulated by the Financial Conduct Authority as a Credit Reference Agency and Open Banking Provider the company is on a mission to improve financial inclusion by revolutionising credit scoring and lending processes.

Founded by risk practitioners turned serial entrepreneurs with more than 100 years of experience in global credit risk and data analytics, AperiData’s real-time risk insights empower organisations to serve their customers digitally and work to improve life outcomes.

For more information, visit: www.AperiData.com

Related