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When the funds stop: maximising the effectiveness of bank card gambling blockers

By Sharon Collard, Jamie Evans and Chris Fitch

Our review of bank card gambling blockers published today shows they can be an effective way to help people control their spending on gambling. To make sure more people can benefit from this technology, all banks and credit card firms should offer blockers as a standard feature on their cards, with a time-released lock of at least 48 hours and the option to limit cash withdrawals.

A lot has happened since September 2019 when we officially launched the ‘Money and Gambling: Practice, Insight, Evidence (MAGPIE) programme funded by GambleAware. With the COVID-19 crisis ongoing, there are concerns that regular online gamblers have gambled more during lockdown; while both the House of Commons and the House of Lords have called for urgent reform of gambling regulation so that children, young people and adults are properly protected from gambling harm.

Our review of bank card gambling blockers shows they can help people control their gambling spend but they need to be much more widely available. While eight UK financial firms offer gambling blocks as standard to customers with a credit or debit card (see Table 1 below), as many as 28 million personal current accounts and 35 million credit cards may not have this option. We believe that blockers should be a standard feature available to all card holders across a firm’s full card range.

There is also work to be done to make sure people know about bank card gambling blocks. Nearly half of our survey participants (43%) – many of whom were receiving treatment and support for their gambling – were not aware that bank gambling blocks exist.

The design of bank card blockers is critical to their effectiveness. Some can be toggled on and off by customers at will – making them a light switch rather than a lock. Our review shows that a time-released lock of at least 48 hours should be a standard feature on all blockers – something the House of Lords also supports. To complement gambling blockers on cards, we want to see customers given the option to limit their ATM withdrawals. A ‘third line of defence’ could be the option to block cash transfers from a credit card to an account where the money could be used to gamble.

Despite the Gambling Commission’s recent ban on licensed gambling companies accepting credit card payments, we believe that every credit card should still offer gambling blocks. This is because online gambling sites outside of Britain are not licensed by the Gambling Commission and continue to allow customers in England, Wales and Scotland to gamble via credit card payments. Credit card providers could go one step further by automatically restricting gambling on all credit cards, rather than relying on customers to turn on a block. Even then, there remains a risk that unscrupulous gambling operators engage in ‘transaction laundering’ which renders a gambling block ineffective.

Gambling blocks can help but they are not enough. People with experience of gambling harms want to see financial firms take wider action if they are serious about helping tackle this public health issue. Beyond banks, they want the gambling industry, regulators and the Government to do much more to protect consumers in a world of boundless and frictionless gambling where, in the words of one participant, it is possible to go from “zero to devastation in a very short period”.

Read the report:

A Blueprint for Bank Card Gambling Blockers – ReportA Blueprint for Bank Card Gambling Blockers – Executive Summary

 

Lessons learnt so far on spending controls for gambling transactions: an update from the MAGPIE research study

By Jamie Evans and Sharon Collard

Yesterday’s move by the Gambling Commission to ban gambling using credit cards is a welcome public health intervention and one that now shifts the focus onto other ways for people to control their gambling spend. ‘Spending controls’, offered by a growing number of banks, provide one such solution, giving customers the option to block gambling transactions from their accounts. But how can banks maximise the effectiveness of such controls? In this blog, we provide an update from our strategic partnership with GambleAware, which aims to answer this and other questions about the potential role of financial services firms in reducing gambling-related harm.

In September 2019, we officially launched ‘Money and Gambling: Practice, Insight, Evidence (MAGPIE)’ – a three-year programme between the University of Bristol’s Personal Finance Research Centre (PFRC) and GambleAware, a charity who fund research, prevention and treatment into the harms of gambling. The programme is designed to explore and improve the way that financial firms tackle gambling-related harm.

Since then, we have been busy working on the first of several projects within the programme. This considers how ‘spending controls’ – otherwise known as ‘gambling blocks’ – that are available on a growing number of debit and credit cards can be as effective as possible in reducing gambling-related harm. To do this, we have conducted expert interviews with banks and other key stakeholders; consulted people affected by gambling through Advisory Boards and interviews; and reviewed academic and other literature on this topic.

We are also working with banks that have launched spending controls to understand patterns in customer data and are running an online survey of people affected by gambling to find out more about their views and experiences of spending controls. Collectively, we hope the new data collected from these different sources will help improve the industry’s understanding of what does and doesn’t work when it comes to spending controls.

So what spending controls currently exist?

Customers of several UK financial services firms now have access to gambling blocks on their accounts (as shown in the below diagram) – and we know of at least one other firm that offers a similar service on request if you telephone them. Blocks on credit card transactions should, in theory, be unnecessary once the wider ban on gambling with credit cards is introduced in April 2020.

The diagram shows that gambling blocks differ in terms of their ‘cooling off’ period (i.e. the length of time after choosing to turn off a gambling block that someone would have to wait until they can gamble again on their account). Some currently offer no cooling-off period, which means that a customer could use the card to gamble as soon as they turn off the block. CashPlus and HSBC both have a 24 hour cooling off period; while Lloyds Banking Group (including Lloyds Bank, Halifax, Bank of Scotland and MBNA) and Monzo require customers to wait 48 hours before they can gamble again.

This cooling-off period is generally recognised, by banks and treatment providers, as a crucial component of an effective gambling block – especially for customers engaged in more high-risk gambling behaviours. As such, we are very likely to see more firms incorporating this kind of ‘friction’ into their spending controls in the near future.

More than the ‘cooling-off’ period…

While obviously important, our work recognises that an effective gambling block is about more than just its cooling-off period. Friction can come in many forms and there are some really interesting ideas on the horizon about the shape that these could take.

There are also a range of other fascinating, albeit challenging, questions that we need to answer. For example, we need to understand more about the customer’s engagement with staff if and when they try to turn off the block, or what happens if they try to gamble when the block is turned on. How are gambling blocks being communicated to customers, and how do financial services firms reach the right people? Who even are the ‘right people’?! It might be the case that a whole spectrum of products and services should be made available to customers engaging in a wide range of gambling behaviours, including those who might not be engaged in risky gambling behaviours right now but may do so in future.

And there are questions that may stretch beyond the usual remit of the financial services sector. How, for example, might unscrupulous gambling operators try to circumvent such spending controls, and – crucially – what can we do about this?

Lessons from the literature

There exists a rich body of academic literature about gambling and ways to reduce gambling-related harm.  To bring this literature to a wider audience – including financial services firms – we have published a Roadmap which sets out the rationale for our programme and summarises some of the existing evidence that is relevant to spending controls. It highlights, for example, the importance of viewing spending controls as one tool in a wider harm minimisation toolkit, as well as the importance of considering the other people affected by gambling (such as partners, families, friends) and the help and support they might require from financial services firms.

You can read this roadmap document here and sign-up for updates about the programme here.        

Gamble Aware announce new partnership with University of Bristol to explore potential role of financial services firms in reducing gambling-related harm

The University of Bristol’s Personal Finance Research Centre (PFRC) is today pleased to announce the launch of Money and Gambling: Practice, Insight, Evidence (MAGPIE), a new three-year strategic programme, in partnership with Gamble Aware, which looks at the role that financial services organisations can play in reducing gambling-related harm.

Gambling problems can destroy lives, often leaving those affected to live with severe financial and social consequences. Indeed, around seven in ten people seeking help for gambling problems report that they are in debt, with a third of these owing £10,000 or more. Between 2007 and 2014 there were an average of 500 bankruptcies per year known to be linked to gambling – the true figure, however, may be much higher because people may not disclose that their bankruptcy is related to gambling.[1]

While many people do enjoy gambling safely, the number of people who are ‘problem gamblers’ or who suffer negative consequences as a result of their gambling is far from insignificant. It is estimated that in 2016 nearly a million adults in Britain experienced sizeable negative consequences as a result of their gambling, with around 360,000 adults classified as ‘problem gamblers’ (Gambling Commission, 2019).

Betting on the banks?

Money and gambling are clearly intricately linked, with ‘gambling more than you can afford’ one of the key indicators of a gambling problem. As such, it makes sense that organisations that help us look after our money – the world of ‘financial services’ – might also be able to take actions to help those at-risk of gambling-related harm.

Such firms are regulated by the Financial Conduct Authority (FCA), which in recent years has upped its focus on the way that companies treat customers in vulnerable situations – including those living with gambling problems. As a result, firms are paying increased attention to the way that they identify and support such customers.

Indeed, in 2016, PFRC conducted research with over 1,500 frontline debt collection staff working in a wide range of financial services firms, including high-street banks, lenders and debt collection agencies. This research focused on staff members’ experiences of working with customers in vulnerable situations, including those with mental health problems, suicidal thoughts and addictions, and highlighted some of the challenges that they face – whether in identifying ‘vulnerability’, starting a conversation about it, or providing customers with adequate support or sign-posting to other sources of support.

Following that research, we held a number of ‘problem-solving workshops’ with firms, charities and those with lived experience of different vulnerable situations to develop new tools and guidance for debt collection staff when working with such customers. Many of the solutions developed have now been adopted (or, in some cases, even adapted) by firms – highlighting the fact that there is considerable appetite among those working in financial services to do what they can to help such customers.

When the funds stop, stop?

Last year saw the introduction of spending controls or ‘gambling blocks’ by several UK banks – most notably Barclays, Monzo and Starling. Once turned on by customers, these essentially prevent spending on a bank card at gambling outlets (both online or in-person).

We know that people in recovery from problem gambling already use informal workarounds to prevent themselves from spending money on gambling, such as forfeiting their card to a third party or scratching off the card security number. The new solutions from banks, however, allow customers to do this more formally – and, possibly, more successfully.

But at present there is limited evidence about the effectiveness of such spending controls, nor about the characteristics of those who use them. We also don’t know much about the unintended consequences of these spending blockers (for example, whether it leads to customers withdrawing more money as cash and gambling with that).

As such, the first six months of our programme will focus on answering these questions and building the evidence-base around what works for recovering gamblers. We will use this evidence to produce practical guidance for financial services firms around the design of spending blockers.

Get involved in the research

In order to build the evidence-base, we’ll be working closely throughout the project with financial services firms – but, more importantly, our research will place those with lived experience of problem gambling at the centre of the project, as well as those with expertise in the treatment of recovering gamblers.

So, if you’re interested in being part of the research or if you simply want to be kept updated, you can join our money and gambling network by filling out this short form.

Notes:

GambleAware is an independent charity that champions a public health approach to preventing gambling harms. The charity is a commissioner of integrated prevention, education and treatment services on a national scale, with over £40 million of grant funding under active management. In partnership with gambling treatment providers, GambleAware has spent several years methodically building structures for commissioning a coherent system of brief intervention and treatment services, with clearly defined care pathways and established referral routes to and from the NHS – a National Gambling Treatment Service. Follow GambleAware on Twitter: @GambleAware

GambleAware also runs the website BeGambleAware.org which helps 4.2 million visitors a year and signposts to a wide range of support services. Follow BeGambleAware on Twitter: @BeGambleAware

[1] See RGSB (2015) Understanding gambling-related harm and debt. Available at: https://www.rgsb.org.uk/PDF/Understanding-gambling-related-harm-and-debt-July-2015.pdf