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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