The UK’s Gambling Commission (GC) has defended its proposed financial risk assessments (FRAs), pushing back against mounting criticism from industry stakeholders who warn the measures could drive customers to the black market.
Debates around FRAs have continued to spiral in what has been a hectic recent period for the UK’s gambling industry, which has also been hampered by the recent increase in Remote Gaming Duty (RGD) tax to 40%.
In a detailed update, Helen Rhodes, the regulator’s Director of Major Policy Projects and Evaluation, said the checks are designed to identify high-spending customers in financial difficulty, rather than introduce affordability limits or spending caps.
The proposals stem from the 2023 Gambling Act review White Paper and have been incessantly backed by the UK government. Affordability was a defining topic of the 2020-2023 Gambling Act review, and FRAs were the touted solution in the April 2023 White Paper.
Gambling Commission to only target 3%
According to the Commission, the system would target a small portion of users, with fewer than 3% of active accounts expected to trigger an assessment. Of those, around 97% would be processed “frictionlessly”, requiring no action from the customer.
Rhodes’ statement came after a pilot of FRAs last year and a further pilot analysis phase. Thereafter, she claimed that much of the commentary and rumours regarding FRAs has been “ill informed or inaccurate”.
“Some coverage has suggested that consumers are currently being driven to use illegal operators as a result of financial risk assessments,” said Rhodes.
“This is despite the fact that the assessments are not live and not a single consumer has had any action taken based on one – even during the pilot. Operators may have asked customers for documents or carried out other checks but those were not financial risk assessments.
“Such checks could be for a range of reasons such as anti money-laundering, commercial reasons or where there were safer gambling concerns from the gambling business.
“Similarly, we have seen suggestions that we are introducing spending limits or caps on customer spend. This is not the case.”
The Commission initiated a six month pilot programme of affordability checks in August 2024, with the initial threshold being set at £500. In February 2025 it was lowered to £150, in line with other player protection thresholds outlined in the White Paper.
Throughout the testing of FRAs, the Commission has remained adamant that only a small number of gamblers would ever encounter them – a commonly touted figure is just 0.1% of British bettors.
Rhodes explained that “we proposed that when a customer hits thresholds that put them in the top 3% of gambling spenders they can continue to gamble, but that this is the trigger to check whether they are in financial difficulties”.
“It is essential that everyone has an accurate picture of what was proposed by the white paper and our consultation,” she reiterated.
Rhodes continued by stating that the initial pilot demonstrated checks could be implemented in a way that avoids unnecessary disruption, while helping to identify vulnerable consumers who may otherwise go unnoticed.
She also explained that operators would be able to improve these “frictionless” FRAs by properly following existing identity and age verification rules under the License Conditions and Codes of Practice (LCCP) set out by the GC, and that strengthening upfront checks would lead to better match rates and smoother customer journeys.
The GC is set to publish more guidance to help operators meet these requirements.
Rhodes added: “Operators have also pointed out that the action they might take to support a customer when financial vulnerability is identified can be seen as friction in the journey. But we cannot forget that interaction or support for a customer who is found to be in financial difficulties is what the policy is intended to deliver.
“This is important because there are a set of vulnerable customers that are not currently being identified – customers in the pilot cohort were between twice and four times more likely to have a debt management plan and between twice and five times more likely to have a default in the last 12 months than comparable consumers in the population.
“Some of these customers are being supported by operators now, but not all. And this support for consumers who are at financial risk can be through many ways, for example, setting deposit limits with or for the customer or reduced marketing. It is really important that customers are supported rather than experiencing a knee-jerk reaction to a financial risk assessment by an operator defaulting to requesting documents (such as bank statements) or closing an account in every case.
“We want better outcomes for consumers, not for them to be unnecessarily pushed out of the licensed market by a risk averse response to indicators of risk.”
DCMS backs review conclusions
Government support for the policy remains firm. Ian Murray, Minister of State at the Department for Culture, Media and Sport, reiterated that the proposals are intended to reduce reliance on intrusive document checks like bank statements, while improving punters’ protection.
When FRAs were first proposed, it was suggested that open banking technology could underpin the frictionless and non-intrusiveness of the checks by enabling discreet sharing of customer data without revealing too much personal information.
“The white paper recognised the “chilling effect” that asking customers for bank documents can have,” Murray noted.
“This is why it set out an alternative approach to assessing financial risk which would be much more frictionless.
“The white paper proposed less than 3% of customer accounts would undergo an assessment – targeting the highest spending accounts. The Gambling Commission’s pilot showed that of these 3%, 97% would have a frictionless assessment process. Those customers would not be required to take any actions, including providing documents.
“Operators would only be unable to conduct an assessment in a frictionless way for one customer in every 1,000 accounts, significantly better than anticipated in the white paper. As the independent regulator, the Gambling Commission will decide how to implement FRAs based on the best available evidence.”
Affordability raises more questions
However, the proposals have faced growing opposition from across the racing and betting sectors. More than 400 industry figures recently signed an open letter to Culture Secretary Lisa Nandy, calling for a pause to the rollout.
Critics argue that inconsistencies in data provided by credit reference agencies could undermine the effectiveness of the system. The Betting and Gaming Council (BGC) has warned that unreliable data may lead to more customers being asked to provide financial documents, contradicting the policy’s aim of reducing friction.
The trade body has repeatedly cited the risk that customers will be pushed towards the black market if FRAs are overly intrusive. In all fairness to the industry, the Commission has noted the prospect of regulatory measures like FRAs having this effect, though as stated by Rhodes it is imperative that the checks can and will be frictionless.
In a statement this morning, the BGC reiterated its concerns about the threat of the black market, specifically citing the Grand National. The BGC asserts that over £100m was wagered on the black market throughout the duration of the Aintree Festival last week, with £40m wagered on the Grand National alone.
Grainne Hurst, Chief Executive of the Betting and Gaming Council, said: “The Grand National is one of the biggest moments in the sporting calendar, enjoyed safely by millions.
“But the criminal harmful black market will also have tried to cash in, targeting punters with illegal betting that offers zero protections. Rising costs and increasingly intrusive checks will only make it harder for legitimate operators to compete.
“The priority must be keeping punters in the regulated market, where safeguards are in place, rather than driving them towards dangerous illegal operators.”
Punters unwilling to conform
Similar warnings have been echoed by racing bodies, notably the British Horseracing Authority (BHA), which fear a potential loss of betting revenue.
Polling cited by stakeholders suggests that a majority of bettors – 65% to be precise – would be unwilling to share personal financial documents to continue gambling, further fuelling concerns about customer migration.
Lastly, even some long-time advocates for gambling reform have questioned the government’ s affordability solution. Dr James Noyes, an advisory with the Social Market Foundation (SMF) thinktank, shared a letter he had penned on the topic to the DCMS earlier this week, for example. Despite the criticism, the GC maintains that financial risk assessments represent a more consistent and proportionate approach to identifying harm, compared with the current “patchwork” of operator-led checks.
The regulator is now reviewing findings from the pilot phase and is expected to present its recommendations to the GC’s board in the coming months. While a final decision has yet to be made, any rollout is unlikely before 2027.
