Open Banking May Re-Invent The Gambling Industry
Open banking is gaining momentum and the gambling industry best brace itself for some significant and potentially far-reaching changes in the future. It all started in 2016 when the UK’s Competitions and Markets Authority (CMA) ruled that banks weren’t exactly bringing their A-Game to ensure customer-satisfaction at especially the country’s high-street banks. What ensued was nothing short of the start of a financial revolution, thanks to customers now being in the position of being able to tap into the world of big data to achieve everything from more effective personal financial management, to the implementation of various checks, limits and self-exclusions.
Keeping A Check On Finances
Open banking allows bank account holders to allow third-party software application owners access to their financial data for a variety of reasons. The applications mainly act as “checks” in order to limit and manage spending and ultimately save money.
Consider a bank account holder who has identified in him or herself a tendency to overspend on online gambling sites. An example of how the API’s (Application Programming Interfaces) would work in this scenario would be to block any payments requested between the individual’s bank account and that of the online casino.
But unlike what this may appear to signal at face value, being a decline in spending at online casinos, operators have actually welcomed the latest fintech to have hit the market. Thanks to open banking, operators will now be in a position to assess and verify everything from personal information (the verification of age is important in this particular scenario) to financial affordability. Online casinos have indicated that this enables site administrators to keep in better standing with regulatory watchdogs such as the UK Gambling Commission (UKGC), to name but one example.
Ultimately, open banking makes more effective control and accountability a real possibility.
Why Better Control Is Good
It was never possible before now for operators to determine whether a player was able or not able to afford the bets being wagered over the course of, for example, a 30-day period. Should players choose to share their personal financial information and status with online casinos, operators will be in the position to perform the necessary affordability checks that will enable them to either limit spending on the player’s online account, or even to make suggestions in terms of more responsible spending.
A number of prominent market role-players have already bought into the idea, one of which is the Rank Group. The group has said that open banking will in future prove to be particularly useful in order for operators to avoid the hefty fines imposed by the UKGC and the ASA.
Rank has confirmed that it is currently performing an open banking trial run.