Open Banking Powers a New Approach to Responsible Gaming in the UK

Open banking has rapidly transformed the UK’s financial landscape since its introduction in 2018, enhancing consumer control over financial data and increasing transparency. In recent years, its application has extended beyond traditional banking, making waves in sectors like e-commerce, personal finance, and now the gambling industry. With Britain’s gambling regulator (UK Gambling Commission, UKGC) embracing open banking technology, a new chapter in responsible gambling is unfolding, particularly around the contentious issue of betting affordability.

The Evolution of UK Gambling Regulation

The UK gambling sector has been at the centre of significant regulatory changes over recent years, with a key turning point being the ongoing review of the 2005 Gambling Act. This review, which has been in progress for over two and a half years, aims to update the UK’s gambling regulations for the modern digital age. Central to this review is the long-standing debate around affordability checks—mechanisms that ensure players are betting within their financial limits.

Affordability checks are now positioned as financial risk checks under the Gambling Act review’s proposals. These checks, which aim to assess whether a player can afford to gamble without risking financial harm, will be greatly facilitated by open banking. Open banking will enable seamless data sharing between customers, operators, and third-party providers, offering a way to assess financial vulnerability before a bet is placed.

At the International Association of Gaming Regulators (IAGR) Conference in October 2024, UKGC CEO Andrew Rhodes highlighted the progress being made with open banking, describing it as a “pillar of the commission’s data transformation programme.” He further emphasised that open banking could revolutionise the way the UK gambling market understands customer behaviour and spending patterns.

The Role of Open Banking in Affordability Checks

The primary use of open banking in the gambling industry will be to facilitate affordability checks. According to proposals laid out in the Gambling Act review, operators will be required to initiate financial risk checks when a player reaches certain thresholds of spending. For example, checks will begin after a net loss of £125 in a month or £500 over a year, with stricter thresholds for larger amounts and younger players (aged 18–24).

Through open banking, customers will be asked to provide consent for a third-party provider to access their financial data. This will allow gambling operators to assess whether a player can sustain their betting activity without entering financial distress. By leveraging real-time, anonymized financial data, operators can quickly evaluate if intervention is necessary, such as setting betting limits or even temporarily restricting accounts.

This system represents a significant improvement over existing self-reporting methods, which rely on the gambler’s own perception of their finances. Open banking allows operators to conduct objective affordability checks, providing a clearer picture of a player’s financial situation. This helps ensure that gambling remains a form of entertainment rather than a path to financial harm.

Enhancing Responsible Gambling with Open Banking

The UKGC’s vision for open banking extends beyond affordability checks, with broader ambitions for its application in responsible gambling initiatives. By using open banking data, regulators can create a more comprehensive Single Customer View (SCV), which would allow gambling operators to have a holistic understanding of a customer’s online gambling behaviour across multiple platforms.

During his remarks at the IAGR conference, Andrew Rhodes shared insights from a recent UKGC pilot that demonstrated the potential of open banking. The pilot involved analyzing anonymized banking transaction data from thousands of individuals to gain new insights into gambling behaviours in Great Britain. For instance, the UKGC was able to track when players made deposits and withdrawals, providing a clearer view of their overall gambling spend.

Open banking could also help regulators and operators identify multi-operator gamblers—those who bet across multiple platforms. This capability allows the UKGC to understand how different operators share customer groups, providing valuable insights into player behaviour and helping regulators take a more targeted approach to responsible gambling.

One of the most promising aspects of open banking in this context is the possibility of using it to implement personalized gambling limits. Based on real-time financial data, operators could automatically adjust betting limits to align with a player’s financial health. This would reduce the reliance on self-imposed limits, which are often ineffective in preventing problem gambling.

Challenges in Adoption and Data Privacy Concerns

Despite the clear advantages of open banking in addressing affordability and responsible gambling, there are challenges to its widespread adoption. One of the most significant hurdles is customer hesitancy around sharing financial data. While the UK has seen increasing use of open banking for everyday activities like paying taxes or managing finances, many people remain wary of sharing their banking information due to privacy concerns.

Repeated high-profile data breaches and instances of companies misusing consumer data have fostered a climate of distrust. Gambling regulators and operators will need to address these concerns head-on to build trust and convince customers that their data will be handled securely.

Andrew Rhodes acknowledged these challenges, noting that while open banking adoption is growing, there remains work to be done in reassuring players that their data will be used responsibly and only for regulatory purposes. Ensuring transparency in how financial data is collected, processed, and protected will be key to overcoming this barrier.

Popular Open Banking Payment Methods in UK Gambling

As open banking gains traction, several payment methods powered by open banking APIs are becoming prominent in the UK gambling sector. These payment solutions offer speed, security, and efficiency, benefiting both operators and players. Some of the most popular examples include:

1. Trustly: Trustly’s “Pay N Play” feature allows customers to make instant bank transfers directly from their accounts without the need for cards or registration. This method is widely used by Trustly slot sites and allows for seamless deposits and withdrawals.
2. TrueLayer: TrueLayer offers real-time payments and data-sharing services, enabling operators to quickly process deposits and withdrawals while helping them assess a player’s financial situation to prevent gambling beyond their means.
3. Yolt Pay: A service that allows direct payments from bank accounts, offering fast, secure transactions and simplifying the payment process for users, particularly in mobile gambling.
4. Zimpler: Zimpler enables easy and quick bank transfers, especially popular in mobile gambling markets. Its integration with open banking allows for real-time transactions with added security measures.
5. Ecospend: Ecospend is an increasingly popular open banking provider in the UK, facilitating direct account-to-account payments without the need for traditional card networks, reducing transaction fees for operators.

These services are transforming the payment landscape in the UK gambling market, making transactions faster and more cost-effective, while simultaneously improving customer satisfaction and operator compliance with responsible gambling regulations.

Conclusion: A Promising but Complex Future

The UK Gambling Commission’s push for open banking represents a bold step towards creating a safer, more transparent, and responsible gambling environment. By integrating open banking technology, the industry can not only streamline payments but also make strides in tackling the affordability debate, which has been a contentious issue in recent years.

However, the road ahead is not without its challenges. Convincing players to adopt open banking solutions will require robust safeguards and clear communication about how their data will be used and protected. If done correctly, open banking could be a cornerstone in transforming the UK’s gambling landscape, ensuring that both operators and regulators can better protect players from financial harm while fostering a fairer, more secure market.