Major bank, Westpac has responded to the ongoing scourge of problem gambling with a punitive measure for customers using its credit cards for online gambling transactions
The bank has decided to charge higher interest on what it describes as “quasi cash” credit card payments, including transactions for Lotto, TAB and other online gambling services.
The bank levies a 22.95% interest for ‘cash advances’ on its Hotpoints Mastercard and has stated that from November 30, all payments to gambling accounts, for cryptocurrency purchases will be categorised as cash advances. Assuming the cardholder does not clear their balance by their monthly payment date; all regular purchases performed with Westpac’s standard Mastercard will incur interest of 20.95%.
The Problem Gambling Foundation responded to this measure, by calling for a review of existing gambling laws and for action similar to that taken by the British Gambling Commission that banned payments from credit cards to gambling companies outright.
This ban was imposed by the commission, following the publication of research that pointed to a significant percentage of problem gamblers using credit cards to fuel their addiction.
Andree Froude, a spokesperson for the Problem Gambling Foundation advised that online gambling numbers were on the increase and “obviously credit cards provide a means for them to do that when they don’t really have the money”.
“I think the move to ban credit cards would be a good one,” she asserted.
Froude added that The Gambling Act was almost 20 years old and that in the time since its creation, technological advances have left it sorely in need of an update.
She further stated that the Department of Internal Affairs had completed a review of online gambling a few years ago and that those results would be made available soon, accompanied by options for regulation.
A spokesperson from Westpac said that the majority of “quasi-cash transactions are used to fund online gambling.”
Froude mentioned that institutions like Westpac have a lot more work to do in the fight to empower gambling addicts with the tools to help themselves. She pointed to Kiwibank, which in April announced that it would offer voluntary credit card gambling blocks to problem gamblers. This is to help them stop gambling with borrowed funds and so far, 127 customers have requested the block, representing an average of $13 000 saved in gambling spend saved per year.
Kiwibank initiated this measure after noting a rise in online gambling harm over the Covid lockdowns.
While Westpac’s Australian operations offer similar voluntary measures to Kiwibank, its New Zealand subsidiaries do not.