ClearStake: Financial vulnerability checks are here to stay… Operators must adapt.

Implementing financial vulnerability checks doesn’t mean we need to sacrifice the customer experience, argues ClearStake CEO Martin Burt.

If you operate in the UK, you are no stranger to regulatory change. But it’s no exaggeration to say that the introduction of financial vulnerability checks (FVCs) last year has arguably been the most challenging to date.

Last August, the UK Gambling Commission introduced light-touch FVCs for online gamblers with net deposits of more than £500 within a rolling 30-day period. That number was reduced to £150 in February this year.

These light-touch checks were designed to identify players who may be at risk of financial harm, using publicly available data without the player’s direct involvement.

We’ll always welcome protections that keep players from harm.

At the same time, operators are now faced with a real challenge to conduct these checks without disrupting the player experience for the vast majority of people enjoying responsibly and within their means.

Over the last few weeks, I’ve spoken directly with many operators in the UK, and the reality is that this is proving to be a real operational struggle.

Operational pressure

Take the question of those flagged for an FVC who come back with a red or amber result, indicating potential financial risk. Estimates suggest that, across operators, this accounts for between five and 15 percent of all players who are checked.

For years, responsible operators have carried out due diligence on higher-risk customers. But the reality now is that the volume has surged. Whereas before, checks might have been focused only on the most active customers, estimates suggest 98 percent of operator revenue is now linked to players who will need to be checked.

It’s tempting, understandably so, for operators to simply take a conservative approach and disengage from customers who fail these checks.

The logic is simple: it’s quicker, safer, and avoids potential regulatory headaches.

But the reality is that taking this approach will end up turning off a lot of players who actually are perfectly fine to continue playing. The data used to assess financial vulnerability can be incomplete or out of date. A player might fail a check because of a missed parking fine several years ago, despite having a stable financial situation today.

And the Gambling Commission has made it clear that if a decision is made to restrict or block a player automatically, that player has the right to challenge it.

This creates a real operational dilemma. Do you cut off a player outright, or allow them to explain their situation? And if you do the latter, how do you handle that at scale without overwhelming your teams?

Putting the customer first

In our conversations with operators, one theme is consistent. This is a volume problem as much as it is a compliance one.

Many operators have told us that they’ve gone from handling a few dozen customer due diligence cases a month to thousands. Of course, without the right system in place, that’s not sustainable, and it’s the customer who ends up suffering.

No operator wants to be in a position where a player feels penalised or embarrassed because of a clunky verification process.

There’s no denying that financial vulnerability checks bring operational burden. Players flagged as higher-risk are often less valuable to operators in pure monetary terms, meaning the payoff for keeping them can be limited. But there’s also an opportunity here to differentiate through customer care.

A transparent, respectful process that gives players a fair chance to clarify their situation can build trust. And trust, particularly in a regulated environment like the UK, is a long-term asset.

This can be delivered at scale in a way that actually decreases the operational burden. I would point to the likes of tombola, a long-time leader in responsible gaming, who are now successfully conducting frictionless assessments on these customers and seeing a large share are in fact fine to continue playing

The next phase for operators will be about fine-tuning their processes to handle these checks efficiently while keeping player experience front and centre. That means investing in systems that can manage the scale of these checks, provide clear insights, and where possible, both streamline and automate the journey for both the operator and the customer.

These checks are not going anywhere; and they are likely to increase over time. I’d also expect to see other regulators around the world follow the UK’s example by introducing similar checks over the coming years.

Right now, the market is adjusting to the new reality.

The operators who succeed will be those who see beyond the immediate challenge and find solutions that account for compliance, care, and the customer experience… Yes, it’s a tough balancing act, but it’s also a vital one.