So-called “affordability” checks have been up for
discussion for the best part of the last six years in the U.K.
gambling industry. Despite this or because of it, they continue to
be plagued by misunderstanding and misinformation from some
stakeholders. While much of the discussion focusses on the rights
and wrongs of measures proposed or set to be implemented, there has
been little debate on the practicalities of their implementation.
On the 1st of May the GB Gambling Commission resolved this to a
certain extent with the publication of the response to last
summer's consultation.
To supplement this, A&M has spoken to the main providers of
solutions in the space to objectively dissect the key
implementation challenges for the Commission – and thereafter
operators.
Here, we provide a summary – get in touch for the full report
and to find out more.
- Multiple data types
While on the face of it, DCMS and the Commission have proposed two types of check (financial vulnerability and enhanced financial risk), these could comprise at least five different types of data, and the composition of those rest on the elusive definition of “financial risk”.
- Narrowness of scope
The scope of enhanced checks could be far narrower than anticipated, with the very real possibility that the “affordability” element is removed entirely and reliance is placed on checks on financial stress and resilience.
- CRAs vs open banking providers
CRAs hold the keys to four of the five data types and are driving the pilot programme for enhanced checks. Expect a small role for open banking providers in the LCCP-mandated checks themselves, but broader usage if enforcement cases show that operators are still required to go beyond these minimum standards.
- Data consent and privacy
Each data type is subject to a different level of customer consent. Financial vulnerability checks will use public data, while enhanced checks will involve a combination of non-consented data proprietary to CRAs and consented data through account information service providers (AISPs), one branch of open banking. Conversion rates for consented data will be a key differentiator for operators.
- Affordability vs AML
Even in their broadest and most frictionless incarnation, these checks will not materially reduce the number of checks on customers, given that they do not touch on source of funds, which is a key AML requirement. An interim affordability code has been published and an interim AML code is being constructed to mitigate this, which could have major implications on enforcement.
Originally published by 13 May, 2024
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