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Sweden Proposes Ban on Credit Cards for Online Gambling
By Shane Addinall Feb 25, 2024 IndustryThe Swedish government attempts to follow in the footsteps of countries like the UK and Australia by banning the use of credit cards for online gambling. The proposal has been met with resistance from the local Trade Association for Online Gambling.Sweden is known to be a financially stable country with low joblessness and a strong economy. According to the World Economics ‘Data Quality Rating’ index, Sweden rates an ‘A’, the highest possible letter grade they offer.
According to the 2024 index:
Quote“Sweden's GDP data quality ranks 8th on a global scale and 7th for Europe, while population and demographic data are positioned 50th and 17th respectively.”
Despite what can only be considered a world-class socio-economic position, the Swedish government has taken it upon itself to determine that its citizens do not have the nous to manage their credit by pushing for a ban on using credit cards as a payment method for online gambling.
The Ministry of Finance Acts to Ban Credit Cards
The Swedish Ministry of Finance released a press release outlining its proposal for the “comprehensive ban on paying with credit when gambling for money". According to the press release, the proposed measure intends to "prevent gambling for money from leading to indebtedness”.
Minister of Financial Markets Niklas Wykman said:
Quote“Gambling for money on credit can lead to great financial difficulties. Therefore, we are now stopping that possibility. It is not reasonable for gambling companies or gambling agents to contribute to individuals taking such large risks.”
The proposal argues that a ban on credit cards for online gambling is not a new measure but rather an extension of the pre-existing restriction on casinos offering players lines of credit. The argument is that while credit cards are not explicitly lines of credit from the casino, the net effect is that customers contract interest-bearing loans to wager on real money casino games such as instant slots, blackjack, fixed odds, and live dealer games.
They believe that banning gambling-related payments for betting or wagering in conjunction with more stringent activities on the part of licensed online casinos to limit excessive gambling will reduce local indebtedness levels.
Swedish Trade Association for Online Gambling Disagrees
However, BOS (Branschföreningen för Onlinespel) has spoken out against the proposal, claiming that the research provided by the Ministry of Finance in support of its proposal is lacking in substance.
In a reference state on the proposal, BOS noted the advantage such a decision would provide unlicensed providers:
Quote“There is no cash in the online gambling market. In the online gambling market, illegal off-license gambling will never be more than a few clicks away on your computer or smartphone, and unfortunately, these unlicensed gambling companies will probably always be able to offer credit card payments.”
And further addressed the limitations it would impose on legal casinos and the stability of the marketplace, saying:
Quote“It is not in Sweden's or the consumer protection's interest to hand over such an obvious competitive advantage to the unlicensed and often illegal gambling market.”
The Trade Association has reiterated its past support for tighter credit regulation without the need for an outright ban. At the top of their list of solutions is creating a Skri register. The output would be a "system for registers of debt and credit information”, which acts as an affordability matrix ensuring that participating members only spend money they can afford to part with.
What makes this an ideal solution for managing the country’s broader debt issues is that the Skri register would contain data on all spending, including subscriptions to streaming services, cinema visits, concerts, sports events and holiday trips, not just online gambling, making it for the more effective tool when managing national indebtedness.
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