Without any prior consultation process, the Gambling Commission has today published additional formal customer interaction guidance for remote operators during the COVID-19 outbreak, including the need for affordability checks, prevention of reverse withdrawals and restrictions on bonus offers.
The Commission states that: “Online operators will be expected to make changes to act on this guidance as soon as possible”, adding that it “will bring forward plans to consult on whether further targeted player protection measures are required on a permanent basis”.
The Commission describes this as “additional guidance” because, pursuant to LCCP Social Responsibility Code provision 4.4.1(2), UK-licensed remote gambling operators must already take into account the Commission’s existing formal customer interaction guidance.
The additional guidance (that you can download below) reads as follows:
Customer interaction – Additional formal guidance for remote operators during COVID-19 outbreak
Social responsibility code provision 3.4.1 (From 31 October 2019) Customer interaction
All licences, except non-remote lottery, gaming machine technical, gambling software and host licences.
1. Licensees must interact with customers in a way which minimises the risk of customers experiencing harms associated with gambling. This must include:
- identifying customers who may be at risk of or experiencing harms associated with gambling.
- interacting with customers who may be at risk of or experiencing harms associated with gambling.
- understanding the impact of the interaction on the customer, and the effectiveness of the Licensee’s actions and approach.
2. Licensees must take into account the Commission’s guidance on customer interaction. This guidance is issued further to the formal customer interaction guidance for remote operators of July 2019.
Due to the ongoing COVID-19 pandemic and associated lockdown, licensees should ensure they have the following measures implemented into their customer interaction framework for the purposes of preventing gambling related harm:
a) Reviews of all thresholds and triggers used to track vulnerability to ensure that they reflect changed financial circumstances that many consumers will be experiencing. An emphasis should be placed on those thresholds and triggers being proactively reset on a precautionary basis to ensure customers with emerging vulnerability, such as increased time spent at play or increased spend can be identified
b) Specifically, review your time indicators to capture play in excess of 1 hour as this is a proxy for potential harm.
c) Set additional or modify existing thresholds and triggers which are specific to new customers reflecting an operator’s lack of knowledge of that individual’s play and spend patterns.
d) Implement processes that ensure the continual monitoring of your customer base, identifying customers whose patterns of play, spend or behaviours have changed in the last few weeks.
e) Conduct affordability assessments for individuals picked up by existing or new thresholds and triggers which indicate consumers experiencing harm. Consider limiting or blocking further play until the checks have been concluded and supporting evidence obtained.
f) Prevent reverse withdrawal options for customers until further notice.
g) Stop bonus offers or promotions to customers displaying indicators of harm
Knowing and identifying your customers at risk of or experiencing harm and acting early and quickly could help stop or prevent the harm worsening.
These measures will be kept under periodic review by the Commission and may be revised in response to changes in circumstance.
The additional guidance will be welcomed by those who have feared heightened problem gambling risks during the current lockdown, including parliamentarians (for example, DCMS Minister Nigel Huddleston and the House of Commons Public Accounts Committee) and in the media. However, others will (a) express grave concern that the Commission has seen fit to publish such additional guidance without any prior consultation with the sector and (b) question whether a real need exists for such further measures as are set out in the additional guidance, bearing in mind that the Commission itself acknowledges that there is “no evidence to suggest an increase in problem gambling”.
However, the Commission’s reasoning appears instead to be based on new research findings that, overall:
- whilst fewer consumers are gambling, some existing gamblers are trying new products (some of which have faster play cycles) – as illustrated in the below infographic,
- whilst gamblers are playing products at the same rate or less, a majority of those who have participated in 3 or more gambling activities in the last 4 weeks are spending more time or money, and
- the number of gambling sessions over an hour in length are increasing (having risen by 23% compared with the same period last year).
More information in the above respects (including access to the above-mentioned research findings) is set out on the Commission’s webpage entitled “Covid 19 and its impact on gambling – what we know so far” (which you can also download below).
Commenting on this additional guidance (and also downloadable below), the Gambling Commission states as follows on its website under the heading “Gambling Commission instructs tighter measures to protect consumers during lockdown”:
The Gambling Commission has today issued new guidance for online operators. It ensures that consumers are further protected following the publication of new evidence that shows some gamblers maybe at greater risk of harm during lockdown. Included in the guidance is the need for affordability checks, prevention of reverse withdrawals and restrictions on bonus offers.
The new guidance follows the Commission publishing data showing the impact that Covid-19 is having on consumers and the industry so far. Collected through the gambling industry and also through YouGov surveys this data shows that during lockdown gambling participation is down overall. This reflects the closure of land based venues and the cancellation of sporting events, with only a small number of people starting to gamble for the first time.
However, while there is no evidence to suggest an increase in problem gambling, the shift in the market as a result of Covid-19 evidence shows an increase in the use of certain gambling products such as online slots, poker, casino gaming and virtual sports.
The majority of those gambling indicate that they have not increased the time or money they have spent, two thirds (64%) of more engaged gamblers  reported that they have increased the time or money that they are spending on at least one online gambling activity including National Lottery products.
The data also shows that in terms of time spent gambling, while overall session length has decreased, there has been an increase in the number of sessions that are played for over an hour
The Commission has reviewed its current guidance in light of the risks that some players may be experiencing harm while in lockdown, and online operators must now take account of the Commission’s additional guidance, which makes clear they should:
- Prevent reverse withdrawal options for customers until further notice 
- Cease to offer bonuses or promotions to all customers who are displaying indicators of harm
- Interact with customers who have been playing for an hour in a single session of play
- Review thresholds and triggers for new customers to reflect the operator’s lack of knowledge of that individual’s play and spend patterns
- Conduct affordability assessments for individuals picked up by existing or new thresholds and triggers which indicate consumers experiencing harm – limiting or blocking further play until those checks have been concluded and supporting evidence obtained, and;
- Implement processes that ensure the continual monitoring of their customer base – identifying patterns of play, spend or behaviours have changed in recent weeks.
Online operators will be expected to make changes to act on this guidance as soon as possible. The Commission will bring forward plans to consult on whether further targeted player protection measures are required on a permanent basis.
Gambling Commission chief executive Neil McArthur said:
“Operators must use the data they hold to protect their customers and now, more than ever, it’s vital that online operators really know their customers by monitoring how long they are playing for and understanding how financial uncertainty is impacting them and what they can afford to gamble with. To ensure operators do that, we are strengthening our guidance and expect operators to take account of that to prevent bonus offers or inducements being offered to customers who are showing any sign of harm‘’
Work was already underway to address many of these issues but this means we will now accelerate this work due to the unique situation that many consumers will find themselves in during lockdown.
‘’We will continue to monitor and publish the data that we are collecting and we will take further measures if required. We are monitoring online operators closely and if we see irresponsible behaviour we will step in immediately, suspending licences if we need to.”
Minister for Sports, Tourism and Heritage Nigel Huddleston said:
“It is vital that people are protected from the threat of gambling related harm and I welcome these latest steps from the Gambling Commission. We will continue to monitor the situation closely and will not hesitate to take further action if required.”
Later this month the Commission will be opening a consultation which will propose strengthened measures around ethical product design, including reverse withdrawals and VIP Inducements.
Following the announcement of the lockdown and social distancing measures on 23 March, Mr McArthur also wrote to online operators to remind them of their responsibilities to protect consumers.
Nigel Huddleston MP wrote to gambling operators in April to remind them of their responsibilities during Covid-19, and urged them to give more prominence to safer gambling messages.
Read the Commission’s full report on Covid-19 related data. The data was taken from YouGov’s Covid-19 tracker, a weekly online survey of around 2,000 adults in Great Britain and from submissions of the biggest operators, covering approximately 80% of the online gambling market (noting that it may include some duplication of customer numbers where it is not possible to identify unique customers).
Read more about Covid 19 and its impact on gambling.
To help give a clear and more rounded picture of current gambling behaviours, we have taken data from gambling operators.
Read more about the risks arising from Covid-19 and our response.
The National Lottery already has similar protections in place but is monitoring the impact of Covid-19 on player behaviour and updating the Gambling Commission regularly on its approach.
In April the Gambling Commission directed £9m to boost resilience of gambling harm treatment services during Covid-19.
Notes to Editors:
- *An engaged gambler is someone that has gambled on three or more products in the last week. Of those who gambled in the last four weeks (but not only for the first time), 8% are engaged gamblers (i.e. have gambled on three or more products).
- Data on increased time/money spent includes playing National Lottery products.
- Most online operators offer consumers the facility to reverse a request to withdraw funds in their gambling account. Consumers can use this facility to change their decision to end gambling, and either extend their session without taking a break or spend more than they originally intended. The Commission, supported by academic research, lived experience and expert advice, already considers the use of reverse withdrawals as a flag for potential gambling harms.
Reported changes in time and money spent on online gambling products do not reflect the time and money people were spending prior to lockdown in land-based venues so we do not know what has happened to these individuals’ overall gambling expenditure.
The Gambling Commission’s above-mentioned webpage entitled “Risks arising from Covid-19 and our response” (that you can also download below):
- summarises changes in gambling-related harm risks to consumers that result from changes observed in data collected from “operators and a wide range of other sources” and
- confirms that the Commission will “take forward work to consult on specific measures around reverse withdrawals, inducements and time of play as permanent consumer protections”.
In relation to those three items it states as follows:
Inducements to Gamble
Research suggests that inducements play a role in impulsive decisions. In the Populus online tracker, free bets and bonuses are the most often cited reason for prompted spend on gambling. We found that 50% of problem gamblers (according to the PGSI) were prompted to spend money on gambling when prompted with a free bet or a bonus, compared with 13% of non-problem gamblers.
Therefore, while our data shows the increased risk remains, we want operators to stop providing inducements for those players that that are showing signs of harm.
Reverse withdrawal functionality
Most online operators offer consumers the facility to reverse a request to withdraw funds in their gambling account. Consumers can use this facility to change their decision to end gambling, and either extend their session without taking a break or spend more than they originally intended. The Commission, supported by academic research, lived experience and expert advice, already considers the use of reverse withdrawals as a flag for potential gambling harms.
We know that there has been a reduction in the use of this facility by approximately 7% compared with March 2019. This could be because there has been a reduction in gambling overall and a small number of larger operators have voluntarily withdrawn the facility. However, we also know that consumers who do use the facility, do so on average 4.7 times per month. Therefore, it is likely to be contributing to the heightened risks of more intensive play for engaged gamblers.
Given this, we are accelerating our plans to take action in this area. We want to remove the ability for consumers to reverse a withdrawal. This would help support consumer decisions for safer gambling and in some cases limit the length of time a player can continue without taking a break.
Controls on session length
Introducing controls on the length of time players can play in a session would limit the time they could play with one operator without a break. However, it is easy for consumers to switch to another operator once their time limit has been reached. Consequently, we think that customer interactions would be a more effective way of mitigating the harm from longer sessions.
Operators should already be conducting effective interactions with players at appropriate times, but we want to make sure that they now factor in sessions longer than an hour.
1. GVC was quick to welcome the additional guidance from the Gambling Commission, stating in a press release (that you can also download below): “while it is also pleasing that the Commission has found no evidence to-date of any increase in problem gambling in the lockdown period, GVC strongly endorses the additional focus on protecting customers”.
2. The Gambling Commission has now published the following FAQ in relation to its additional formal customer interaction guidance:
Why has the GC introduced this new guidance at this time?
The Covid-19 Guidance builds on the Guidance we issued in July 2019 to support Social Responsibility Code Provision 3.4.1. In the July 2019 Customer Interaction Guidance we said:
How to use this guidance
The purpose of this guidance is to share knowledge based on research, current practice and lessons learned in order to support licensees in determining how they can meet the outcomes. It sets out why customer interaction is important and makes our expectations clear. Not all of the content of the guidance will be relevant to all operators, but licensees must take it into account and be able to demonstrate how they have done so.
How the Commission will use this guidance
For compliance and enforcement purposes, we will expect licensees to demonstrate how their policies, procedures and practices meet the required outcomes. This can be through implementing relevant parts of the guidance or demonstrating how and why implementing alternative solutions equally meet the outcomes.
Our understanding of gambling harms and how they manifest is constantly evolving, so for the purposes of raising standards, protecting consumer interests, and preventing harm to consumers, we will update and re-issue guidance where new evidence or risks emerge which may have a meaningful impact on how the outcomes can be met.
Based on our understanding of data relating to the present situation and the likelihood that some customers may be experiencing harms, we judge this additional guidance to be necessary to address the emerging risks
Can you give further guidance on preventing reverse withdrawal options for customers?
Whilst the aim should be for the reverse withdrawal option to be removed from your website, we recognise that operators may either be reliant on third party software providers or subject to quality assurance processes. Therefore, operators may decide to prevent or block reverse withdrawals for now and completely remove the option as soon as they are able to. In any event, it should not be possible for a customer to reverse a withdrawal after and provided this is no later than 31 May 2020
What if operators cannot make the changes by 31 May 2020?
Where operators cannot make the changes by 31 May 2020, we expect them to contact their Compliance contact to discuss their timetable for implementation and/or suitable interim workarounds.
What if customers ask for a reverse withdrawal?
If a consumer asks an operator to proceed with a reverse withdrawal, operators may find it beneficial to make it clear to customers that it is a regulatory requirement to prevent reverse withdrawals.
Does this require amendments to terms and conditions?
We do not require operators to alter their terms and conditions to include the suspension of reverse withdrawal but it may be sensible to consider user-friendly communications to ensure the message is delivered.
There is a requirement to cease to offer bonuses or promotions to all customers who are displaying indicators of harm. Should this just be applied to stopping the marketing itself or does it also extend to preventing the take up of bonuses by the customers displaying indicators of harm?
This applies to stopping direct marketing and preventing the take up of bonuses by consumers displaying indicators of harm.
Are affordability assessments a new requirement?
The requirement to consider affordability is not new. Considering what a consumer can afford to spend is referenced within the July 2019 Guidance at 2.8 to 2.11.
Can you give further guidance on the expectations of interaction with customers who have been playing for an hour in a single session of play?
As part of their drive to make gambling as safe as possible, operators should be using all the information they know about a customer to determine the most suitable form of interaction. See also section 3 in the Guidance issued in July 2019 titled ‘Interact’.
3. On 12 June 2020, as reported by us here, the Gambling Commission published updated data showing the impact of the Covid-19 lockdown on gambling behaviour, the key findings of which are consistent with those published on 12 May 2020 (as described above).