The percentage of gaming accounts that were able to receive a frictionless financial risk check increased in the second stage of the Gambling Commission’s pilot of the white paper policy.
After stage one of the trial showed that a frictionless examination was possible in 95 per cent of cases, this rose to 97 per cent in stage two.
In tandem, the percentage of accounts which were not able to receive a frictionless assessment fell from five per cent to three per cent.
Great Britain’s gambling regulator noted that stage two of the pilot also covered more checks as well as more accounts – 860,000 accounts compared with 300,000 in stage one and around 1.7 million checks in stage two compared with around 530,000 in stage one.
The Gambling Commission’s director of major policy projects, Helen Rhodes, said: “These further findings from the pilot have helped us understand the extent that assessments could be conducted in a frictionless manner.
“Building on our staged approach to the pilot, we will now further explore data consistency across credit reference agencies, as well as how to support operators to identify the severity of financial difficulties that a customer may be experiencing and how they could support these customers.”
Financial risk checks, proposed in the 2023 white paper on gambling reform, are a proposed way to identify high-spending gambling customers who may be in financial difficulty.
The Commission has once again insisted the term is “not just another way of saying ‘affordability checks’,” adding it does not have any regulatory requirements for affordability checks and is not proposing any.
“Financial risk assessments would be a much more targeted way of identifying customers who are in current significant or imminently worsening financial difficulties by flagging customers who are for example in significant or multiple arrears, defaults or bankruptcy,” the regulator said.
It is hoped the checks will help prevent customers being able to gamble large amounts of money without any checks or support being in place, which the Gambling Commission has been keen to highlight in recent enforcement action.
The first two criteria for success are based on the proportion of customers checked that could get a frictionless financial risk check if introduced, and how quickly credit reference agencies could return a financial risk assessment, with the Commission aiming for this to happen “within minutes.”
The estimation of the percentage of customers who could receive a frictionless financial risk assessment in the 2023 white paper was 80 per cent, and the forecast for the percentage of accounts requiring a more invasive check was 20 per cent.
The pilot, which commenced in September 2024 and involves a group of the UK market’s largest online gaming operators, also asks whether using credit reference data is meaningful for the understanding of an individual customer’s current or imminent overall financial risk and financial vulnerability.
The fourth key criterion for success is based on how that data could be presented to operators to help them understand the level of financial risk or vulnerabilities associated with individual customers. This stage also asks how operators could build financial risk assessments into their overall customer interaction processes.
Stage three has just come to an end, the Commission said, and is being followed by a post-stage three analysis period, allowing it to further assess issues that have been raised earlier in the pilot.
Stage one looked at a cohort of inactive customers, while stage two looked at active customers.
Included in stage two is the “thin file” rate, where the customer could be identified but there was limited information and no adverse information.
“We consider these ‘thin files’ to show no financial risk in the gambling context,” the regulator said. This ‘thin file’ rate stayed at approximately three percent of the assessments in both stages one and two.”
