The Swedish Gambling Authority has called for a ban on credit card gambling in a dissenting response to a government investigation into risky lending.
Spelinspektionen has outlined its stance on the proposals put forward in a report published by the Ministry of Justice in July. Interested parties have since been asked to comment on the report “Improved consumer protection against risky lending and over-indebtedness”.
The research found that the reasons against introducing a ban on credit card gambling outweighed the reasons for banning it. Among the proposed measures was a debt and credit register system.
In response, Spelinspektionen reiterated its legal position that the Gambling Act prohibits license holders from encouraging players to take out loans. Those who do so are failing in their duty of care as set out in Section 1 of the Act. The agency noted that in a recent survey of licensees, about 60% offered payment by credit card.
Sweden should follow the example of Great Britain and Norway…
The general director of Spelinspektionen, Camilla Rosenberg, said that the legal situation needed to be clarified through an amended legal text. Although Sweden admits there are practical problems with introducing a ban, it could follow the example of Britain and Norway.
Rosenberg said: “The authority assumes that the investigation did not sufficiently take into account the signaling effect that a ban could have. “It highlights the perception that gambling for borrowed money is an undesirable phenomenon in society.”
The agency said it supported most of the proposals, including a debt and credit registry system.
Rosenberg said: “An efficient and well-founded credit check plays a very important role in counteracting excessive indebtedness among people with gambling problems. The Swedish Gambling Authority is therefore positive about the inquiry’s proposal to introduce a debt and credit register system (SKRI register).
“The Swedish Gambling Authority has no objection to the proposed design of the system, but would like to emphasize the importance of careful consideration in further preparation, for example with regard to the question of what detailed requirements must be imposed on a credit reference company” in order to be allowed to to maintain an SKRI register.”
Counteract risky lending
The investigation examined the loan market and proposed measures to counteract risky lending and over-indebtedness. The brief involved assessing what phenomena contribute to the risk of consumers borrowing money they cannot repay.
The mandate included proposing a debt register system and examining what measures could create better conditions for debt repayment.
Since publication, the ministry has invited responses from a number of voices, including Svenska Spel and Branschföreningen för Onlinespel. The court system, health care professionals, and agencies representing consumers and banks were also surveyed.
The United Kingdom announced a ban on the use of credit cards for gambling in April 2020. The Gambling Commission found that the implementation of the ban went smoothly and had no “unintended consequences”.
In September, the Australian government introduced the Interactive Gambling Amendment Bill 2023 to ban the use of credit cards. The bill would see fines of up to AU$234,750 imposed on operators who fail to comply with the ban.