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Do deposit caps cause more harm than good at online casinos?

Do deposit caps cause more harm than good at online casinos?

by Stelly in Industry | 14 August 2020

Governments and regulatory bodies around the world are constantly trying to find new ways to protect players from problem gambling.

The online casino industry is one based on the premise of fun and entertainment but unfortunately, that doesn't mean it's without its issues. Problem gambling and gambling addiction are prevalent in many gambling markets but online casinos are the latest addition to the list - and therefore, receive the most scrutiny.

The latest craze among lawmakers is to place restrictions and limits on how much players can deposit into their casino accounts. While governments claim this is to help, industry experts and regulators fear it may be doing more harm than good.

Possible "soft cap" for the UK

In a recent report released by industry 'think tank' SMF, it was proposed that a £100 cap be placed on what players can spend at regulated UK online casinos.

It was stated that this could help lower-income households control spend without causing harm. However, the Betting and Gaming Council (BGC) disagreed with this suggestion.

“Some 30 million people enjoy an occasional bet, whether that’s on the Lottery, bingo or sports and gaming, and the overwhelming majority of them do so perfectly safely. We already carry out robust and improved affordability checks and regularly intervene on customers to ensure they gamble within their means.

We disagree with the suggestion of an arbitrary and random low cap on spending and can think of no other area of the economy where the government determines how much an individual can spend.”

As stated by the BGC, placing a cap on how people spend their money is nothing short of a nanny state mentality aiming to handhold players through a process that is aimed at adults.

It could also cause players to seek out unregulated sites where they are not restricted which is the exact opposite of what regulatory bodies should be working towards.

Belgium's weekly deposit limit

Faced with the majority of the country being forced to stay indoors due to the novel Coronavirus, Belgium’s Gaming Commission introduced a mandatory €500 weekly deposit cap for all players in April.

This cap forces operators to restrict what players can deposit unless they can prove that the player is not on the National Bank's list. Unfortunately, there is no procedure in place that allows operators to access this information easily.

While players can choose to lower this cap as they please, operators are forced to restrict players causing frustration for both the casino and the player.

Initially intended to be a temporary measure, there is no end in sight to the current restrictions and will remain in place until the Gaming Commission decides that players are no longer at risk - or not.

There are those in the industry that suspect the law may become a permanent fixture if the Commission sees it working for their players.

Sweden on lockdown

Once again, in an attempt to keep players safe during the lockdown, the Swedish government enforced a "temporary" casino limit in July. The new measures mean players can only deposit a maximum of SEK5000 (less than €500) into their account on a weekly basis. It also restricted what operators could offer as a bonus, setting the cap at a mere SEK100. Heavy fines were also put in place for operators who couldn't or wouldn't implement the changes as soon as possible.

Operators and industry experts have called for the government to lift the restrictions with immediate effect as it would only harm the industry as a whole, and push players away.

“This decision by the Swedish government will only drive more players to the black market which is just a click away," said Fintan Costello, managing director of an affiliate marketing company. "Further bonus restrictions and relying on hard deposit limits instead of affordability checks will make the legal market even less appealing to local players."

Deposit limits and caps may be put in place with the best of intentions but there's no doubt that they cause chaos and further put players at risk unnecessarily. They simply aren't effective and are a lazy way to ensure "responsible gambling".

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