22Dec

Department for Culture, Media and Sport publish voluntary Code of Good Practice for prize draw operators

22nd December 2025 Ruby Duncalf 29

On 21 November 2025, the Department of Media, Culture and Sport (“DCMS”) published the Voluntary Code of Good Practice for Prize Draw Operators (the “Code”) in Great Britain. DCMS estimates the annual market value of the prize draw sector to be £1.3 billion with 7.4 million adult participants annually across approximately 400 operators. DCMS recognises that whilst the operation of prize draws does not require a licence under the Gambling Act 2005, research has shown how prize draws sit adjacent to the gambling industry, presenting concerns in light of gambling-related harms. The Code, agreed by the Government and a significant number of prize draw operators, aims to strengthen player protections and ensure that individuals who participate in prize draws do so more safely.

Purpose and scope of the Code

The Code applies to prize draws in Great Britain where:

a) the outcome (and therefore allocation of prizes) is determined by chance; and

b) there is both a paid entry route and a free entry route.

The Code outlines key measures that prize draw operators are expected to implement to strengthen player protections and ensure that those who participate in these draws do so more safely. The Code is voluntary, applies only to free-entry draw elements of a business, and does not replace existing regulation and requirements for prize draw operators. Any failure to abide by the Code will not itself constitute a breach of an operator’s legal responsibilities.

Implementation timeline

At the time of writing, the Code has been signed by 141 signatories who have committed to implement the Code in full within 6 months of its publication and not later than 20 May 2026 (“Implementation Date”). Operators becoming a signatory of the Code after the Implementation Date must ensure their full compliance immediately. In the absence of an established industry trade body, signatories are expected to share practices on how to implement measures and work with operators who are not yet signatories to the Code to adopt these measures and subsequently join the Code.

Oversight and compliance

DCMS will have oversight of the Code, reserving the right to delegate oversight to an industry trade body as necessary. DCMS will periodically review the Code’s effectiveness, noting that should the Code not be suitably implemented or complied with, DCMS reserve the right, following consultation, to introduce changes where necessary.

All signatories of the Code have agreed to act in good faith. If concerns arise about non-compliance, these should first be raised with the relevant operator or by contacting DCMS at [email protected].

The Code

The Code is divided into three core areas: Player Protections, Transparency, and Accountability, each summarised in turn below.

Player protections

a) Prize draws should only be made available for players aged 18 or over with a reasonable age verification process in place. Advertising should not be targeted at under 18s.
b) Credit card payments in excess of £250 per month per player should not be accepted.
c) Suitable proportionate maximum monthly total spends should be set for players or players should be permitted to set their own, including the option to set a limit at £0.
d) The option to suspend or permanently close an account should be provided to players.
e) Reasonable efforts should be made to have effective systems and processes in place to monitor player activity to identify harm or potential harm.
f) Where operators are able to identify any indicators of harm, they should take a tailored and proportionate approach to intervention that mitigates harm and encourages responsible play.
g) Operators should signpost players to available support for those experiencing harm.
h) An appropriate time period should lapse between a prize draw opening and concluding.
i) Operators should ensure that all marketing and advertising of their prize draws is in line with the CAP and BCAP code, and should be undertaken in a socially responsible manner.

This section of the Code also covers complaints processes, operators’ conduct during a player’s suspension, measures in relation to instant win games, and further requirements regarding marketing and advertising.

Transparency

a) Operators should provide a clear summary of how each prize draw works, including the statement that prizes are to be awarded by chance.
b) Promoters of prize draws should ensure that prizes are awarded fairly in accordance with the rules and terms displayed to players, and this should be by (or under the supervision of) an independent person, unless the winners are selected by a computer process that produces verifiably random and auditable results, or by a certified physical drawing machine.
c) Where possible, prior to entering a draw, operators should provide players with clear and easily accessible information regarding the likelihood of winning a prize and how prizes will be allocated.
d) Operators should clearly and prominently provide players with details of any “free entry” options for the prize draw before the point of purchase, and in line with the requirements of the Gambling Act 2005.
e) Operators should promptly provide the winning player with the advertised prize for a draw or a reasonable cash alternative.

This section of the Code also covers charitable contributions and further details regarding free entry options.

Accountability

a) Operators should have processes in place to monitor and regularly review their own compliance with the Code and, where inadequacies are identified, take swift actions to ensure compliance with the Code.
b) Operators should take reasonable steps to ensure that all relevant Code requirements are also followed by any third parties that support their prize draw operations, such as affiliate marketers or draw management partners. Where third parties are not compliant with the Code, terminating relationships should be considered.
c) Operators should engage with other operators to share best practice in relation to player protections, transparency and accountability.
d) Operators should publish all of the measures they have in place relating to player protections, transparency and accountability, and ensure their adherence with the Code is transparently displayed on their websites.
e) Operators are encouraged to work with DCMS to ensure the Code remains fit for purpose and share any learnings or challenges.

The full Code and requirements can be found here.

Next steps

Please get in touch with us if you have any questions about the implementation or compliance with the Code.

17Dec

Regulators issue joint institutional statement on illegal online gambling

17th December 2025 Ruby Duncalf 35

On 25 November 2025, the gambling regulators of Austria, France, Germany, Great Britain, Italy, Portugal and Spain (the “Regulators”) issued a joint institutional statement, calling for stronger measures against illegal online gambling (the “Statement”).

The Statement acknowledges that “illegal online gambling continues to undermine the integrity of regulated markets”, and that “its borderless nature and the speed of technological innovation make it easier for illegal operators to evade regulatory oversight”.

The Regulators expressed their concern at the increasing level of advertising by illegal operators aimed at their jurisdictions. The Statement stressed that advertising disseminated through digital channels, including social media, video platforms and affiliate networks, not only contravenes national legislation but also places citizens, including minors and vulnerable individuals, at heightened risk from illegal gambling activities.

The Statement follows the Gambling Commission’s heightened effort to understand the illegal gambling market, signified by the publication of its four-part series between September 2025 and November 2025, launched to better understand consumer engagement with illegal online gambling, the associated risks and the actions being taken to disrupt it.

In June 2025, experts at the International Association of Gaming Advisors (IAGA) conference, estimated that in 2024 alone, illegal online gambling represented 71% of total iGaming revenue in all 27 EU states or €80.6bn.

By issuing the Statement, the Regulators wished to highlight their strong commitment to consumer protection, market integrity and compliance with national and international regulations within the respective legal frameworks by:

Sharing information on illegal operators between them;
Calling on digital platforms and social media networks to strengthen their control mechanisms to prevent the dissemination of advertising content from unauthorised operators; and
Reaffirming their commitment to share knowledge and better practices in identifying, investigating, and sanctioning operators acting outside the law.

The Statement ultimately signals a clear message: regulators across Europe are united in their determination to combat illegal online gambling, strengthen the integrity of the regulated gambling sector and to protect citizens from the risks posed by illegal gambling activities.

Next steps

Please get in touch if you have any questions regarding unlicensed gambling in Great Britain, your due diligence obligations, and how to actively monitor your business relationships.

17Nov

White Paper Series: Gambling Commission update on deposit limits

17th November 2025 Ruby Duncalf 71

The Gambling Commission has announced further changes to the remote gambling and software technical standards (“RTS”) aiming to improve the gambling management tools available to consumers. From 30 June 2026, all online operators must provide customers with the opportunity to set a ‘deposit limit’ which is based solely on the amount a customer pays into their account over a set duration.

Background

Following the Autumn 2023 consultation, the Gambling Commission announced changes to take effect on 31 October 2025 to strengthen consumer protection in online gambling (“Initial Consultation”). Responses to the Initial Consultation identified inconsistencies with the way operators interpret ‘deposit limits’. The Gambling Commission launched a supplementary consultation in March 2025, setting out proposals for clarifying ‘deposit limits’, and other financial limits in the RTS.

Helen Rhodes, the Gambling Commission’s Director of Major Policy Projects, said in relation to the proposed changes to the RTS:

“Our work will help empower consumers to have greater awareness and control over their gambling. These further changes will also bring consistency and clarity for those consumers choosing to set deposit limits, while still supporting gambling businesses to offer customer choice for different forms of limits.”

Summary of the proposals and new requirements

Proposal 1: Default ‘gross’ deposit limits must be offered to the customer

The proposal was to include a requirement that, as a minimum, ‘gross’ deposit limits must be offered to customers. The intention was to improve consistency across the industry and to simplify the landscape for consumers.

RTS requirement 12B:

As a minimum, the gambling system must offer gross deposit limits – where the amount a customer deposits into their account is limited over a particular duration.
Where more than one type of limit is made available in the gambling system, operators must ensure that ‘gross’ deposit limits are offered to customers with at least equal prominence to other limits.

The following requirements will also be added to RTS 12B, which provide further clarity:

Where a customer sets simultaneous time frames, for example a daily deposit limit and a weekly limit, the most restrictive must always apply. Therefore, if a daily deposit limit of £10 and a weekly limit of £100 are both set then the maximum the system must allow to be deposited is £10 per day and £70 per week.

The gambling system must prevent a customer from further depositing funds once a deposit limit is reached, until the defined period of the limit restarts or the customer takes action to increase the limit (subject to a standard 24 hour cooling off period).

Applies to: all gambling – except subscription lottery.

Proposal 2: The application of the term and definition of deposit limit

The intention of this proposal was to improve clarity for the consumer and consistency across the industry.

RTS requirement 12B: Only limits that meet this definition can be referred to as a deposit limit, and limits meeting this definition must be described to a customer as a deposit limit.

Applies to: all gambling – except subscription lottery.

Proposal 3: Wording of financial limits in the implementation guidance including the introduction of ‘net’ deposit limits

The intention of this proposal was to provide increased consumer choice by amending the implementation guidance to allow for other types of limits should operators choose to make them available.

RTS implementation guidance 12B: In order to maximise consumer choice, operators could also offer:

stake limits: where the amount a customer stakes on gambling (or specific gambling products) is restricted for the period or duration of the limit applied; and/or
loss limits: the total value of stakes placed on gambling products minus the total value of any winnings or returns from those stakes is limited for the period or duration of the limit applied; and/or
net deposit limits: the amount deposited into the account minus any withdrawals made for the period/duration of the limit applied.

Applies to: all gambling – except subscription lottery.

The Gambling Commission has published the amended RTS 12 wording in full including both the changes coming into effect from 30 June 2026 and the changes to RTS that are in effect from 31 October 2025.

Next steps

The new RTS requirements come into force on 30 June 2026. Licensees must adhere to these requirements before this date.

Please get in touch with us if you have any questions about the new deposit limit rules.

10Nov

Gambling Commission concludes its series on illegal online gambling

10th November 2025 Ting Fung 68

On 6 November 2025, the Gambling Commission published the final report in its four-part series on illegal gambling. The series, which launched in September 2025, aims to understand consumer engagement with illegal online gambling, the associated risks posed and the actions being taken to disrupt it, and has thus far addressed:

Part 1: Consumer awareness, drivers and motivations
Part 2: Consumer engagement and trends
Part 3: Disruption of illegal online gambling

The final report, titled ‘Challenges of estimating the size of the illegal online gambling market’, explores the challenges of quantifying an activity that is, by its nature, hidden. Chief Executive, Andrew Rhodes states that:

“Illegal online gambling remains a serious threat to consumers and to the integrity of the regulated market. While measuring the full scale of the problem is complex, our understanding is growing — and so too is our ability to disrupt illegal operators.”

Challenges to understanding, progress building and shared responsibility

The final report notes the continuing significant methodological challenges of measuring the scale of the illegal online gambling market but also, that although no single estimate of market size has been published, the Gambling Commission has nevertheless, developed a stronger evidence base and clearer understanding of both consumer behaviour and illegal operator tactics. The Gambling Commission emphasises that tackling illegal gambling requires a coordinated response and continued collaboration across government, industry and digital platforms.

Next steps

The Gambling Commission will continue its programme of research, data collection and enforcement activity on illegal gambling, which it identifies as a ‘key strategic priority’ and will provide updates accordingly as it progresses. Annex A of the final report outlines a summary of next steps to improve the reliability of estimates, including options for new sources of data and evidence, alongside an assessment of whether these options will satisfactorily fill key information gaps.

28Oct

DCMS Consultation on Category D gaming machines and licensing for bingo premises

28th October 2025 Ting Fung 79

The Department for Culture, Media and Sport opened its consultation on Category D gaming machines and licensing for bingo premises on 15 October 2025.

Consultation proposals

The aim of the consultation is to ensure that the regulatory framework is fit for purpose, with the proposals addressing:

Stakes and prizes for Category D machines

For non-money prize machines, Government is proposing to split the “non-money prize machine” category into two; one for “non-money prize, slot style” machines, which maintain the current 30p stake limit and a £8 non-money prize limit, and one for “non-money prize, non-slot style” machines with a stake limit of up to 50p and non-money prize limits of up to £20. Other proposed changes include creation of a new pusher subcategory of machines, an increased non-money prize limit from £50 to £75 for crane-grabs and an increased stake limit from 20p to 30p for coin pushers.

Age limit for ‘cash out’ slot style machines

The consultation includes the proposal to make it an offence to invite, cause or permit anyone under 18 to use ‘cash out’ slot-style Category D machines, as set out in the previous government’s response to its consultation on measures relating to the land-based sector.

In respect of the voluntary agreement implemented by Bacta members in 2021 to ban under 18s using adult-only gaming machines, Government proposes to move this agreement into legislation to cover the minority of family entertainment centres not already complying with Bacta’s age restriction agreement.

Bingo licensing

The key proposal relates to the establishment of a ‘bingo area’ in all licensed bingo premises to help create a clearer distinction between adult gaming centres and bingo premises, and to ensure that land-based gambling premises are appropriately licensed. The consultation proposes three options for the amount of floor space in licensed bingo premises that should be designated as a continuous bingo area – either a 30, 40 or 50 percent minimum (it is Government’s view that requiring a proportion of floor space greater than 50 percent of the venue could be disproportionately burdensome for some small bingo venues.).

Government is also seeking views on rules that could apply to a ‘bingo area’, including prohibiting cabinet and in-fill style gaming machines in a ‘bingo area’, the type of content that can be included on electronic bino terminals in the ‘bingo area’, and requiring a minimum number of positions for bingo in the ‘bingo area’.

Participants may respond online or email their responses to the consultation questions to [email protected]. The consultation closes at 11:59pm on 9 January 2026.

If you have any questions, please do not hesitate to contact us.

15Aug

Horizon Scanning: Key Dates for your Diary

15th August 2025 Ruby Duncalf 140

As the implementation of a number of the White Paper proposals continue to take effect, it is essential that licensees and stakeholders are prepared for the upcoming regulatory reforms. This blog sets out the key dates for licensees to be aware of, to avoid falling foul of the forthcoming changes to regulations.

Key dates for your diary

1 October 2025 – Statutory Levy – the first invoices for this year’s statutory levy will be issued from 1 September 2025, with payment required before 1 October 2025. The statutory levy replaces the previous “RET” payments, and is charged to all gambling licensees (if it is more than £10) at a set percentage rate applied to licensees’ regulatory returns. See our previous blog on the statutory levy here. The Gambling Commission will be issuing guidance on how to pay the levy before September.

10 October 2025 – Changes to the Financial Penalties Determination Process – updates to the Gambling Commission’s Statement of principles for determining financial penalties will come into effect on 10 October 2025, strengthening the transparency and consistency of how the Gambling Commission calculates and imposes penalties. For further details of the changes, please see our previous blog.

31 October 2025 –Updates to the RTS – updates to the remote gambling and software technical standards (“RTS”) to enact minor changes to the existing RTS wording, ‘elevating’ some parts of the implementation guidance to requirements and to introduce new requirements and implementation guidance in respect of customer led tools. These changes are summarised in our previous blog.

31 October 2025 – Transparency of Protection of Customer Funds – operators whose customer funds are ‘not protected’ in the event of insolvency must inform the customer at the point of first deposit, and actively remind them once every six months that their funds are not protected. See our previous blog on this topic here.

19 January 2026 – Socially Responsible Incentives (extended from original implementation date of 19 December 2025) – operators will need to comply with the updated requirements which we outlined in our previous blog, and include:

a ban on mixed product promotions,
a cap on wagering requirements of promotional offers to ten and
a reworded LCCP Social Responsibility Code Provision 5.1.1.

Next steps

Please get in touch with us if you have any questions about the upcoming regulatory changes and sign up to our blog to receive updates on the continued progress of the implementation of the White Paper proposals.

08Aug

White Paper Series: Gambling Commission update on the new gambling promotion rules

8th August 2025 Tiffany Babayemi 134

On 24 July 2025, the Gambling Commission announced that the changes aimed at increasing the safety and simplicity of consumer promotional offers, originally due to come into force on 19 December 2025, will be pushed back by a month and will take effect on 19 January 2026.

What are the new rules?

In our previous blog, we outlined the key changes, which include:

Mixed product promotion ban.

Bonus wagering requirements being limited to 10.

Rewording the Rewards and Bonuses section of the Licence Conditions and Codes of Practice (“LCCP”) regarding Social Responsibility Code 5.1.1 (Rewards and Bonuses).

These changes are part of the Gambling Commission’s response to the Autumn 2023 Consultation and are in line with the commitments within the White Paper.

The reason for this delay in implementation is to allow the gambling industry more time to prepare for the changes, and is in response to an industry request.

Next steps

Licensees should be aware that these changes will now come into force on 19 January 2026. Please get in touch with us if you have any questions about these upcoming changes.

09Jun

Gambling Commission welcomes OSR review of the Gambling Survey for Great Britain

9th June 2025 Tiffany Babayemi 130

On 22 May 2025, the Gambling Commission welcomed the findings from the Office for Statistics Regulation’s (“OSR”) review of the Gambling Survey for Great Britain.

The GSGB

In July 2024, the Gambling Commission published the Gambling Survey for Great Britain (the “GSGB”), which sets out the Gambling Commission’s official statistics on gambling behaviours in Great Britain. After several years of extensive development, the Gambling Commission asked OSR to review GSGB against its standards in the Code of Practice for Statistics to support continual improvement and provide independent assurance on quality and transparency.

OSR review of the GSGB

OSR published a public statement and comprehensive review of the GSGB and provided a series of important recommendations to further enhance its reliability and user engagement.

According to OSR, the absence of accredited official statistics status does not imply the GSGB is of lower quality or reliability than other surveys which have “accredited official statistics” status, and that the decision on which one to use should be based on user need and not accreditation status. OSR acknowledged how the Gambling Commission had presented clear and impartial information about the strengths and limitations of the methodological approach and statistical uncertainty of survey estimates.

While the Gambling Commission had already acted on several areas outlined in the report based on earlier feedback, the Gambling Commission has confirmed it will provide a further, fuller update in July 2025 in line with OSR’s request. The Gambling Commission has noted that its guidance for users of the GSGB was updated in February 2025, with clearer examples and dedicated contact channels for questions or concerns. The Gambling Commission has also committed to promoting this guidance more widely and embedding it across all future releases.

OSR noted that communication and user engagement will be critical to the GSGB’s ongoing success. In response, the Gambling Commission has announced plans to establish a GSGB Statistics User Group. Around 70 stakeholders have already expressed interest in joining the group, which will serve as a forum for dialogue, feedback, and shared learning.

Ben Haden, Director of Research and Statistics at the Gambling Commission, said:

“We welcome the findings from OSR, both the public statement regarding casework they have received in relation to GSGB and their overall review of the GSGB. We are pleased they recognise the huge amount of work that the team has put into developing and delivering the largest survey of its kind in the world. We also welcome OSR’s recommendations for further action, which closely align with work that we already have underway.”

Other recommendations

The Gambling Commission has noted that further improvements are underway in line with recommendations from the independent review of the GSGB by Professor Patrick Sturgis of the London School of Economics and Political Science. An experimental research project was launched by the Gambling Commission in April 2025 to test specific aspects of the GSGB’s methodology, and fieldwork is now in progress, with findings expected in Summer 2025. These results will inform the second GSGB annual report, due for publication on 2 October 2025.

Other recommendations that the Gambling Commission confirms it has already actioned:

survey improvement plan updated with further information for users;
new survey questions designed to validate GSGB findings against external data sources, such as GAMSTOP and the Bingo Association; and
improvements to accessibility and usability of GSGB outputs which links to guidance added to statistical outputs released on 22 May 2025.

Other recommendations that the Gambling Commission says it will action:

comparisons with forthcoming datasets from the Health Survey for England and the Adult Psychiatric Morbidity Survey, due in 2025;
publication of a communications strategy to improve how GSGB updates are shared; and
ongoing improvements to accessibility and usability of GSGB outputs to be informed by GSGB stats user group.

The Gambling Commission highlights its continued engagement with other official statistics producers, including Ofcom, the Money and Pensions Service, and devolved government agencies, and is reviewing user engagement frameworks to develop a formal user engagement strategy. In addition, the Gambling Commission stated that a full log of requests to the GSGB statistics from stakeholders has been published as part of its transparency agenda and will be updated quarterly.

The Gambling Commission encourages stakeholders to complete the GSGB Statistics User Group Sign Up Form to learn more about the GSGB or to express interest in joining the user group.

Please let us know if you have any questions on the above and sign up to our blog to receive updates on the continued journey of the GSGB.

11Apr

White Paper Series: Gambling Commission publishes statutory levy guidance

11th April 2025 Harris Hagan 165

On 7 April 2025, the Gambling Commission published its guidance on the statutory levy and how licensees can prepare for it. The Gambling Levy Regulations 2025 (the “Levy Regulations”) took effect on 6 April 2025 and introduced a mandated levy on all operating licence holders in Great Britain to fund research, prevention and treatment of gambling harms. Please refer to our previous blog, White Paper Series: Statutory Instrument published for statutory levy, for further details of the Levy Regulations.

The Gambling Commission’s guidance sets out snapshot information on the statutory levy, including:

Who will collect the statutory levy

The Gambling Commission collects the levy on behalf of the Department for Culture, Media and Sport.

Who must pay the statutory levy

The levy will be charged to all gambling licensees. However, licensees are not required to pay the levy where the amount of that levy is £10 or less (for a given period).

How the statutory levy is calculated

The levy will be charged at a set rate for all Gambling Commission licence holders, ranging from 0.1% – 1.1%.

The basis and rate to be paid will vary depending on the licensed product (see the statutory levy rates by licence product table). The basis will be from the following list, as appropriate:

Gross Gambling Yield
proceeds retained after good causes and prizes paid out
gross value of sales or any amounts that will otherwise accrue to the licensee in connection with activities authorised by the licence.

The calculation for the amount owed under the statutory levy is based on the data that licensees provide via Regulatory Returns. The guidance reminds licensees of their obligation to provide ‘true and correct’ data, and any incorrect data submitted would impact the calculation of the amount owed by levy.

When licensees need to pay

Licensees must not pay the statutory levy until they receive their invoice.

The first invoices will be issued on 1 September 2025, with payment required on or before 1 October 2025.

The levy will then be invoiced annually on 1 September and will cover the period of 12 months beginning with 1 April.  

How to pay the statutory levy

Invoices will be issued to licensees by email (not via eServices) and payment can be made using GovPay or Bank Transfer.

Statutory levy payments must be paid in full by 1 October, and in line with the details on the invoice. Full details of how to make the payments will be provided by the Gambling Commission before September 2025.

Consequences of not paying the statutory levy

Payment of the statutory levy is a licence requirement, and therefore non-payment, or late payment, of the levy by the licensee will result in revocation of the operating licence. 

Removal of voluntary RET Contributions

Following the announcement of the introduction of the statutory levy, the Gambling Commission responded to the consultation proposing to amend the Licence Conditions and Codes of Practice to remove the requirement for licensees to make a voluntary annual financial contribution to one or more organisation.

Accordingly, as of 31 March 2025, licensees are no longer required to make annual financial contributions to research, prevention and treatment due to the levy’s introduction.

Next steps

Licensees can prepare for the statutory levy payment by ensuring:

regulatory returns data is submitted correctly and on time,
the Gambling Commission holds the correct contact details (i.e. email address) for your organisation, and
payment is only made once an invoice has been received.

Please get in touch with us if you have any questions about the Levy Regulations or the Gambling Commission’s guidance on the statutory levy.

04Apr

White Paper Series: Gambling Commission update on the financial risk assessments pilot

4th April 2025 Tiffany Babayemi 169

On 10 February 2025, the Gambling Commission provided an update on the ongoing three-stage pilot of financial risk assessments (the “Pilot”) following completion of the first Stage. In this blog, we consider the Gambling Commission’s findings from Stage 1 and what can be expected from the next Stages of the Pilot.

What is the Pilot?

Following the Gambling Commission’s consultation response of 1 May 2024, social responsibility code provision 3.4.6 was introduced requiring operators in the three highest bands of fee categories, and volunteers in the lower fee categories, to participate in its Pilot of financial risk assessments.

Financial risk assessments are intended as a way of identifying high-spending online gambling customers who may be in financial difficulty and at risk of gambling-related harm. The risk assessment is intended to be “frictionless” and to be provided by a credit reference agency. The Pilot is being used to test how financial risk assessments can work in practice and to support a frictionless customer journey, and to assess appropriate thresholds.

The Pilot was expected to take place in three stages running from 30 August 2024 to 31 March 2025 inclusive, however, the Gambling Commission can extend the Pilot period until the end of April 2025 should this be necessary for practical reasons. Stage 1 looked at historic data, Stage 2 tested “more recent” data, and Stage 3 reportedly used current data. It is important to note that the Pilot is not a ‘live test’, and consumers have not been affected.

The Pilot is testing four set success criteria:

Frictionless part 1: What proportion of those high-spending customers checked could get a frictionless financial risk assessment if they were introduced?
Frictionless part 2: How quickly could credit reference agencies return a financial risk assessment?
Data relevance and accuracy: Is using credit reference data meaningful for understanding of an individual customer’s current or imminent overall financial risk and financial vulnerability?
Implementation issues: How could the data be presented to operators to help understand the level of financial risk or vulnerabilities associated with individual customers? How could operators build financial risk assessments into their overall customer interaction processes?

At each stage of the Pilot, the Gambling Commission has been testing at least one of the success criteria, and each stage is expected to provide different results. For example, the Gambling Commission stated that “it is likely that a smaller proportion of accounts would be able to receive a frictionless assessment when using historical data”. In our view, this is likely due to historical data having limited information available compared to more current or real-time data. The Gambling Commission has stated that its final decisions regarding financial risk assessments will also be informed by other evidence and data.

Stage 1 of the Pilot

When Stage 1 completed, it was considered by the Gambling Commission as “a pilot of the Pilot”. The Gambling Commission’s intentions for Stage 1 were to:

Test how the Pilot participants prepared data for the credit reference agencies and how the data was returned to the Pilot participants;
Test the Pilot reporting tools to see if the right data was getting back to the Gambling Commission; and
Refine and improve its systems for Stages 2 and 3 of the Pilot and identify issues that need further exploration.

Stage 1 looked at historical data for a cohort of inactive customers, and tested customer accounts which had met high-spending thresholds during a set period. The account details were shared with one or more credit reference agencies, which provided a financial risk assessment at the point the threshold was met. Stage 1 was testing what financial risk indicators were present when the account met the high-spending threshold. The credit reference agencies are replicating how they are providing financial data to operators as close as possible to automated or live implementation.

What were the findings of Stage 1?

Stage 1 involved more than 530,000 assessments across three credit reference agencies for approximately 300,000 accounts for the relevant year.
Approximately 95% (503,500) of these assessments met the first success criteria of a frictionless assessment. This means that the data shared by the operators was successfully matched by the credit reference agencies, which would allow a financial risk assessment to be returned to the operator in a frictionless manner.
Of the 95%, just over 3% were considered “thin files”, where the customer can be matched, there is no positive credit history, but the lack of negative indicators means they are considered lower risk in terms of financial vulnerability.
Approximately 5% (26,500) of the assessments were unmatched or the data provided by operators was invalid. These assessments were not able to receive a frictionless financial risk assessment. This is lower than the 20% anticipated by the White Paper.
Of the 5%, just over 4% of the assessments were unmatched (where the credit reference agency was unable to identify the customer and no information was available), and less than 1% were due to data formatting issues, invalid data, or duplications in the data provided to the credit reference agencies by operators.

According to the Gambling Commission, Stage 1 has primarily met the first success criterion on the proportions of customers that might be able to receive a frictionless check. It also provided insights on data quality and understanding (success criterion 3) and implementation issues (success criterion 4). Stage 1 did not look at the speed of an assessment (success criterion 2).

However, Stage 1 identified issues relating to data quality and implementation, which are to be explored further before financial risk assessments are introduced.

Data quality issues

The quality of operator data can play a role in reducing friction and operators can take steps to reduce duplicate accounts and rectify incorrect data fields to improve data linkage rates.
Credit reference agencies have unique systems and ways of presenting the findings back to the Pilot participants which caused some issues for the Pilot participants in assessing the findings. For example, a green RAG rating means different things across credit reference agencies.

At the time of the update, the Gambling Commission claimed that more can be done in Stages 2 and 3 to support operator understanding of different systems and allow credit reference agencies to make refinements to their models to reduce unnecessary variation or confusion. The Gambling Commission will also propose common definitions, such as time periods, to ensure commonality across credit reference agencies where needed.

Implementation issues

Pilot participants seem uncertain about the exact actions that might be proportionate when they consider both the financial risk assessment and the information they already hold and act on for customer interaction.

The Gambling Commission has created a working group of the Pilot participants to focus on these issues with the intention of informing guidance to operators. As part of Stage 1, the participants shared anonymised case studies to help provide early insight into how the financial risk assessment could inform decision making.

What next?

The Gambling Commission’s progression to Stage 2 reportedly involved testing more recent data and refining some of the aspects tested in Stage 1. The emerging findings from both Stage 1 and Stage 2 reportedly informed the Gambling Commission’s approach to Stage 3 of the Pilot, where current data is being used.

The Gambling Commission has emphasised that its findings of Stage 1 are preliminary but it expects the interactive and collaborative approach of the Pilot to prove worthwhile in testing how financial risk assessments might work in practice before final decisions are made.

Financial risk assessments were one of the more controversial proposals of the Government’s White Paper, and it is therefore vital that the Pilot is conducted carefully and transparently. Whilst, in theory, financial risk assessments are workable, one of the industry concerns was how risk assessments would be conducted in practice. Stage 1 has already identified possible hurdles, including the discrepancies across credit reference agencies. These practicalities must be ironed out for financial risk assessments to be effective, particularly as Stage 1 demonstrated that 26,500 of the assessments were unmatched or the data provided by operators was invalid. As such, without these practicalities addressed, these assessments may still create a disproportionate amount of friction for customers and operators alike. The Gambling Commission’s update indicated that it took these findings into consideration as Stage 2 of the Pilot progressed. Whilst the outcome of Stage 1 seems relatively positive, we wait to see the outcome of Stages 2 and 3 before a full assessment on the success of the Pilot can be made.

Please get in touch with us if you have any questions about the financial risk assessments Pilot or its Stage 1 findings.

Responsible Gambling