The Commission released the host of new rules for the market yesterday. These covered the four areas from the first consultation round stemming from the Gambling Act review white paper. These are financial risk – or affordability – checks, direct marketing, online games design and age verification for land-based venues.
The rules will begin to be rolled out from August 2024 and wrap up in February 2025.
The affordability checks proposal has effectively been split into a two-part process. A pilot for what the Commission dubs “frictionless” affordability checks will last for six months and will assess already-available data.
A separate process, entitled “light touch” financial risk checks, will see checks occur in two rounds. The first will start on 30 August 2024. This will be triggered once net deposits reach £500. In February 2025, this will be reduced to £150.
Consumers will not be impacted by pilot
Speaking at an industry briefing on 1 May, Tim Miller, executive director of the Commission, affirmed that the frictionless checks would not require any information from players.
“It’s information you can find out about users without having to go to credit reference agencies,” he explained. “No consumers will be asked to provide any documents… consumers will not be impacted during the pilot process.”
Miller said that the data collected for the pilot would be analysed gradually.
“In terms of the type of information that will be used during the pilot, we’ll do this in a phased approach.” Miller explained. He went on to add that “the operators involved in the pilot will look at historic data”. This will analyse past accounts as well as current betting accounts.
The pilot itself will be “relatively high level”, he continued. “We are approaching this pilot with an entirely open mind.”
Miller also confirmed that the Commission will invite smaller operators to take part in the scheme. As, in the Commission’s view, “for some of them, the regulatory burden could be higher.”
Two part light-touch checks necessary
The Commission is wary of “dragging in” accounts that do not meet the thresholds for checks. Nonetheless, Miller highlighted that the pilot will be used to identify customers that are not initially captured by a frictionless process.
Despite forming part of a controversial proposal, the new affordability check rules have generally been well received by the industry. Nigel Harvey, AML consultant at Betsmart Consulting notes that the rules wouldn’t have been a surprise to operators. This is because they would have been warned well in advance.
“I don’t think there are any surprises from the Commission. A lot of the work for operators would have been going on in the background for months already,” he poses.
For the light-touch rules, Harvey believes it is necessary to launch the checks in two parts. This will be to ensure they have the correct impact.
“The GC already informed us that this two-stage format would be happening and that is very much the right approach,” he reiterates. “Let’s remember this measure is to protect consumers from harm. So, getting it right before being fully rolled out was vital.”
Harvey also highlighted the Commission’s decision to use net deposits, as this might mitigate concerns that £150 was too low.
“As the GC has repeatedly said, many operators are already performing these checks. Some before a single penny has been spent. We’ve certainly seen that with our clients too.”
More trust in the Commission
Kevin Dale, CEO of eGaming Monitor praised the Commission’s data-led vision for the pilot.
“On frictionless checks, which is the biggie, it’s good to see the idea of data-driven pilots with an assessment of proportionality at the end,” he said. “Also the fact that checks will be limited to publicly available data.”
But the small amount of players that will not experience frictionless checks is an area of concern, he continues.
“The line that nothing is fully implemented until it’s truly frictionless sounds good until you read the suffix of ‘for the vast majority’ – which is still a concern.”
Looking at the new rules in a more general sense, Harvey gave credit to how the Commission has handled the consultation process and roll-out.
“I also think there is more trust in the commission in 2024,“ he explains. “A few years ago, a GC consultation would have been seen as pointless – ‘They’ve already decided what they are going to do, the consultation is just going through the motions.’”
“I think there has to be credit for Mr Rhodes and Mr Miller the way they have communicated with all stakeholders throughout this process. Not everyone will be happy, they never are, but I think what we have seen are the right decisions based on data.”
Age verification and casino functionality
The new rules also mandate strengthened age verification rules for land-based operators. All land-based licensees will have to conduct age verification test procedures.
Modifications will also be made to the good practice code. This will involve licence holders mandating staff to check a customer’s age if they appear under the age of 25, instead of 21.
Harvey said he was surprised to learn the amount of failed age verification tests, adding that changes were absolutely necessary.
“I was quite surprised to read that 45% of age verification tests in category A and B were reported as fails with no challenge to the tester at all,” he explained. “I don’t think there can be any argument with those kind of stats that changes were necessary. Do they go far enough? Well, that’s what evaluation is for, and I guess time will tell.”
Five core changes will also come in for games design, banning features such as autoplay and celebrating returns of less than, or equal to, the amount staked.
“I’ve always been against celebrating wins that are lower than or equal to stakes so this is welcome,” Dale noted, adding that he also sees an issue with games that promote superstitious thought.
“I actually have an issue with operators who encourage superstitious behaviour – for example, ‘hot’ and ‘cold’ games or numbers,” Dale continued. “But if they were to include this in game design they would have to broaden the reach of any changes to lotteries too.”
Original article: https://igamingbusiness.com/gaming/gaming-regulation/frictionless-checks-dominate-white-paper-consultation-rules-talk/
