Westpac Increases Interest on Credit Card Gambling Payments
![Australia-owned Westpac Group announces it is increasing interest on credit card gambling transactions to more than 22% from Jan. 1, 2022.](https://www.internetpokies.org/app/uploads/2021/12/a90684f3f167b7b25a3eb8b59489d491f8f3c726-16x9-x0y192w2048h11521-1.jpg)
New Zealand residents funding their gambling via a credit card face higher interest payments. Australian-owned Westpac is increasing interest payments on its credit cards from January 1, 2022. Aussie credit card users expect similar measures from issuers on home soil.
Westpac announced using a credit card for gambling purchases falls under the “quasi cash” category. These payments come with increased interest, similar to cash withdrawals. Furthermore, purchasing cryptocurrency with a Westpac credit card carries similar levels of interest.
Customers of Westpac face 22.95% interest unless they clear their monthly balance by its due date. Most customers do this, but an increasing number of problem gamblers do not. It is those with gambling problems that see their addictions, and the harm from those addictions, spiral out of control.
Is a Blanket Ban on Credit Card Gambling Forthcoming?
Increasing interest rates for gambling transactions does not come as a surprise. Banks and credit card firms do not want their customers using their products for gambling. Indeed, the United Kingdom Gambling Commission last year banned all gambling with credit cards. Gamblers in the UK no longer wager with money they do not have. However, many use the overdraft facility of their bank accounts, which is essentially the same thing.
New Zealand-based Problem Gambling Foundation (PGF) advocates a blanket ba on credit card gambling. The PGF argues credit cards prompt problem gamblers to continue gambling when they are out of cash. It wants New Zealand to take a similar stance to the UK.
The Australian Banking Association (ABA) released a paper in December 2019 highlighting a number of issues about gambling on credit. The study showed credit cards exacerbates a problem gambler’s issues. This leads to increased debts in addition to creating a vicious circle of gambling outside their means.
One Australian bank banned all credit card gambling on July 1, 2019. Macquarie blocks all transactions using gambling merchant codes. The payment does not go through, and the customer has no choice but to use another method.
Voluntary Gambling Blocks on Cards
Andree Froude is a spokesperson for the PGF. She welcomed the new of making it more expensive to gambling on credit, but does not believe it is the solution. Gamblers can easily use debit cards and prepaid tickets and avoid higher interest. Froude wants voluntary gambling blocks made readily available across the industry.
Wespac Group expanded its digital gambling block feature for more customers on October 1, 2021. The feature makes it possible for customers to block their gambling spending in real-time. Transactions to online gambling, online casinos, and other products are instantly blocked once the feature is applied.
Catherine Fitzpatrick, Westpac’s Director of Customer Vulnerability & Financial Resilience, explained more.
“Problem gambling continues to be a serious issue in Australian communities, and as more people transact online during the pandemic, the digital feature gives customers the ability to manage their gambling spend whenever they might need it. The benefits of being able to apply a block in real-time also gives customers more control and flexibility in the moment.
“While the majority of customers are now using digital channels to complete their everyday banking tasks, our Customer Care team continues to remain available as another way for customers to call and have a block applied.”
Australian Parliament Considers a Total Ban
The Australian government is considering banning all gambling-related credit card transactions. In addition, e-wallets such as Neteller and Skrill are under threat.
Several prominent gambling companies voiced their concerns over such a ban. Ladbrokes Australia’s chief executive, Dean Shannon, is against it. Shannon warned such a ban has massive negative connotations for the racing in industry in Australia.
“Racing is driven by turnover and if you take away the credit cards, I would say, at a guess, it would affect 30 per cent plus of turnover. I think a ban on credit cards would be quite short-sighted and the follow on effects that would spin the racing industry into decline.”
However, Tabcorp announced it will not fight a ban unless the law made it impossible for local newsagents to sell lottery tickets.