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Banks to add online betting fee

One of the biggest UK banks, HSBC, announced that they will add a special rate on their credit cards for transactions related to online gambling, such as depositing in online casinos, sports books and poker websites. From the beginning of February the bank will calculate the APR on online gambling payments using the adjusted rate from 21.9% to 27.8% - a big leap from the regular purchases which accumulate from 15.9% to 22.9%. According to HSBC spokesman, this move for increased rates comes to help the bank compete better on the markets. Other institutions, such as RBS and MBNA are trying similar approach by also increasing fees for online betting and gambling transactions.

All this could be seen as yet another attempt by the banks to increase their profits, but using the hot button issue of online gambling in their advantage. Recent reports have shown that less than one per cent of the total spending in the UK, using credit cards, goes to gambling. And, HSBC admits that they have no evidence that people who use their credit cards to place bets and gamble on the web, accumulate big debts.

This move by the U.K. banks is welcome by services such as Neteller, which lets you transfer money from your bank account or credit card to them, and use them as a payment method at the online casino. This way the transaction will be a "retail charge" and will be charged the interest of a regular transaction, thus avoiding the hefty new fees. This could come as a breath of fresh air for Neteller, after the company announced at the end of December that, Corvina International Ltd, a company owned by the former chairman of Neteller, Stephen Lawrence, has unloaded almost 2.4 million shares of Neteller, cutting his interest in the company which he formerly resided over.

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