The Gambling Commission (GC) has announced its financial risk assessment pilot indicated 1 in 1,000 customers would face a non-frictionless assessment.
The pilot study was undertaken in a closed loop system last year. Initial findings published by the regulator found 97% of checks were frictionless.
That report came after a stage one study noted 95% of checks were frictionless.
In a GC blog, published by director of major policy projects and evaluation Helen Rhodes yesterday, 16 April, the figure was quoted as remaining at 97%.
The pilot has also suggested just 0.1% of accounts would be unable to have a check conducted frictionlessly.
Financial risk assessment, or affordability checks as they are also known, were included in the 2023 white paper into the Gambling Act 2025 review.
Published under the previous Conservative government, the white paper suggested 80% of checks would be frictionless and 0.6% of accounts would not be able to have a frictionless check.
The frictionless aspect of the checks within the pilot scheme has seen operators work with credit agencies to cross-reference data points provided by customers.
In the blog, Rhodes also took aim at what she declared “ill-informed or inaccurate” commentary surrounding financial risk assessments.
Many critics have argued the policy has help drive black market growth and hampered horseracing, as players leak out of the regulated system.
The British Horseracing Authority (BHA) wrote an open letter to the government this month in which the sport’s regulatory body said the implementation of affordability checks would be a “grave misjudgement”.
The BHA letter also claimed the checks would “do lasting damage” to the racing industry.
James Noyes, a senior fellow at think tank Social Market Foundation and a gambling reformer, also argued affordability checks should be paused.
In a letter to DCMS chief Lisa Nandy, Noyes said there needed to be a “adequate evaluation and scrutiny” of the pilot scheme.
Rhodes wrote: “There has been a lot of recent commentary about financial risk assessments and sadly much of it has been ill-informed or inaccurate.
“For example, some coverage has suggested that consumers are currently being driven to use illegal operators as a result of financial risk assessments. This is despite the fact that the assessments are not live and not a single consumer has had any action taken based on one – even during the pilot.
“Operators may have asked customers for documents or carried out other checks but those were not financial risk assessments.
“Such checks could be for a range of reasons such as anti-money laundering, commercial reasons or where there were safer gambling concerns from the gambling business.”
What next?
However, later on in the post, Rhodes did highlight that some customers are departing the market due to the checks.
She added: “It is really important that customers are supported rather than experiencing a knee-jerk reaction to a financial risk assessment by an operator defaulting to requesting documents (such as bank statements) or closing an account in every case.
“We want better outcomes for consumers, not for them to be unnecessarily pushed out of the licensed market by a risk-averse response to indicators of risk.”
Rhodes noted several operators that took part in the pilot had “expressed some concern about consistency of data between credit reference agencies”.
The GC head remarked the pilot had been able to provide “useful information” on the consistency of data among credit reference agencies.
Looking ahead, Rhodes said “no one should pre-judge what comes next”, with the pilot findings due to be taken to the GC board for consideration.
She continued: “If the decision is made to introduce these assessments, we will work closely with the industry and credit reference agencies on the details of a sensible implementation plan.
“We are mindful of the risk of over implementation or overly quick implementation of regulatory requirements which could lead to unnecessary friction for consumers.
“The Commission would also look to work with operators on guidance that will help operators take a proportionate approach when offering support to consumers where financial risk is present and the customer continues to spend at a high level.”
The post GC “mindful of risk” of implementing affordability checks too quickly first appeared on EGR Intel.
Regulator publishes further findings from pilot as it hits out at “ill-informed or inaccurate” claims the policy is driving black market growth
The post GC “mindful of risk” of implementing affordability checks too quickly first appeared on EGR Intel.