SBC News Voice of the Sports Betting Industry
Branschföreningen för Onlinespel (BOS), Sweden’s online gambling trade association, has urged the government to rethink the framework applied to its comprehensive ban on gambling on credit.
The measure proposed by the Ministry of Finance will see Sweden adopt an outright ban on all forms of credit applied to gambling transactions.
Current laws prohibit all licensed operators from processing credit card transactions, as specified by the Gaming Act of 2018, the legislative framework which re-launched Sweden’s gambling market.
Yet amendments endorsed by the Ministry of Finance have proposed that an outright ban on all forms of credit-funded payments be applied to Swedish gambling.
As such, beyond credit card transactions, licensed operators would no longer be able to process any credit-based funds such as personal loans, deferred payments, and overdrafts.
The comprehensive ban on credit transactions forms part of a package of measures proposed by the Ministry, which called for greater enforcement powers to be granted to Gambling Inspectorate Spelinspektionen, alongside new duty of care requirements on the prevention of excessive gambling.
The legislative process is underway to implement the ban, with a memorandum issued for comments by 23 May 2024, and Riksdag voting expected in late 2024. Subject to parliamentary approval, 2024’s Gambling Act amendments are proposed to be effective from 1 April 2025.
Responding to developments, BOS urged the government to reconsider the technical arrangement of its proposed ban.
Gustaf Hoffstedt, Secretary General of BOS, suggests that if the government proceeds with the proposal, the responsibility to prevent credit card payments for gambling should be imposed on credit card issuers rather than gambling operators.
“If the government nevertheless goes ahead with the proposal, BOS proposes that the obligation not to mediate payments for gambling purposes be imposed on those issuing credit cards rather than on gambling operators.”
BOS contends that further restrictions on legal gambling operators will not only fail to protect consumers but will also push them towards unregulated platforms, which lack the stringent consumer protection measures mandated by the government’s ongoing review of Swedish gambling laws and standards.
In this way, it will be prohibited for credit card issuers, under the supervision of the Swedish Financial Supervisory Authority (Finansinspektionen), to mediate payments via credit cards for all gambling companies, including illegal and/or unlicensed gambling companies. Almost half of the Swedish online casino market is unlicensed and/or illegal due to heavy restrictions on the licensed market.
Hoffstedt emphasized that in the name of consumer protection, it is crucial not to add new restrictions that would further burden those placing bets on the legal market. By targeting credit card issuers, the government can better manage the risks associated with credit-based gambling while maintaining a healthy, regulated market that protects consumers.
The trade body concludes that regulatory stakeholders need to understand a deep concern for “maintaining a balanced regulatory environment that safeguards consumer interests” without inadvertently encouraging illegal gambling activities.
