Australians will soon be banned from using credit cards to fund their online gambling as the government steps up its crackdown on the industry.
The legislation also grants new powers to the Australian Communications and Media Authority to ensure its ability to enforce the law.
Gambling companies could face a penalty of $234,750 (US$150,000) if they do not implement the ban.
Communications Minister Michelle Rowland said a ban on credit cards would reduce online gambling harm among the population.
“Legislating a ban on the use of credit cards for online gambling will help to protect vulnerable Australians and their loved ones.”
Echoing the sentiment, Social Services Minister Amanda Rishworth said the legislation was the next step in the government’s plan to bring down problem gambling rates in the country.
“You can’t use your credit card to place a bet for land-based gambling, and the same rules should apply for online gambling too,” she said.
“We know minimising the harm caused by online gambling is not a set-and-forget exercise, and I look forward to working with my state and territory counterparts on what comes next to continue this positive change.”
Credit Ban Extends to Digital Wallets and Cryptocurrency
The ban is also extended to other types of credit products and cryptocurrency to close potential loopholes in the legislation.This means online gamblers will not be able to use digital wallets such as ApplePay, buy now pay later services, and newly emerged credit payments to fund their habit.
“This mitigates the risk that individuals could purchase cryptocurrency using a credit card and then use these funds to pay it online,” Ms. Rowland said.
In addition, while people can still use their credit cards to bet on horse racing, there is a limit on the amount they can wager.
The legislation will also provide gamblers and betting companies with a grace period of six months to adapt to the changes.
Next, the government will introduce a mandatory measure that requires gambling companies to verify a customer’s identity when they register for a new account and before they can place a bet by the end of September.
Concerns About New Legislation
While the Financial Counselling Australia (FCA), a peak industry body, welcomed the reform, it expressed concerns about the legislation not covering online lotteries.“There is no good reason for online lotteries to allow people to buy a $10,000 ticket on credit or for people to enter a $3,000 syndicate on credit. Gambling is gambling.”
The director also noted that betting companies already capitalised on this loophole and called on the government to take action.
“It’s coming fast and furious on our TVs and in social media, so the loophole is already being exploited,” she said.
“This latest manoeuvre by the online gambling industry, and the speed at which its tactics were developing, strengthens the argument for another parliamentary inquiry focusing just on lotteries.”
However, the peak body said the actual figure was much higher and could account for up to 20 percent of all suicides in the state.