The opportunity for banks to be part of the solution to gambling harm

Today, we’ve published new research on the opportunities that banks and building societies have to better support customers experiencing gambling harm as part of our Gambling Harms Action Lab. 

Our latest policy note – First line of defence – explores how banks can use transaction data to support customers at risk of or experiencing gambling harm. When someone is at risk of or experiencing gambling harm, there are often only two organisations that know: the gambling operators and their current account provider. We consider how financial services firms can better support customers who need help, striking a balance between people’s data privacy and the need to offer appropriate and timely support.

The latest Gambling Survey for Great Britain found that 1.4 million people (2.7%) in Britain are experiencing ‘problem gambling’, meaning they’re experiencing severe adverse consequences to their mental wellbeing, social relationships or financial harm. A further 6.5 million adults (11.9%) were at low or moderate risk of experiencing ‘problem gambling’ – a level that means they may be at risk of experiencing some form of harm to relationships, wellbeing or their finances. 

Those figures are worrying, but they aren’t even the full picture. Excluding people who only participated in the National Lottery, nearly one in three people (32.2%) who had gambled in the last 12 months had experienced some form of harm as a result of gambling. When put into context, we can begin to see how visible gambling harm can be from people’s spending and behaviours – a lens financial services have sight of through transaction data.

Following the implementation of the Financial Conduct Authority’s Consumer Duty in 2023, financial services firms have a duty to ensure good consumer outcomes and prevent foreseeable harm. This type of work – analysing transactions to protect and better support customers – is not new for banks, who have been delivering similar processes in fraud prevention efforts for many years. 

We know that among those who have gambled recently, almost one in three are at risk of experiencing some form of gambling harm, so financial services firms are in a prime position to increase awareness of the range of support available. 

So what do we recommend? 

Money and Mental Health is calling for all banks and building societies to utilise existing data on customers’ accounts to identify spending and behavioural indicators of gambling harms, and get in touch with targeted proactive offers of support. This should include analysis of at least one potential spending or behavioural indicator of harm. 

• Spending indicators – Current account providers can use spending indicators to track gambling harm, such as the amount deposited to gambling accounts across a set time period, or consider the amount of net gambling spend (deposits minus withdrawals) to capture specifically financial losses incurred. 
• Behavioural indicators – Firms can also opt to consider a range of behavioural indicators of harm, such as an increase in the number or value of deposits – a sign someone may be chasing losses or nighttime gambling. 

Another unique vantage point that current account providers have is that they can overlay spending and/or behavioural indicators with an affordability lens. For instance, if gambling coincides with missed essential payments or someone gambling in their overdraft. 

Banks and building societies should seek to intervene early, taking action before the most severe forms of gambling harm occur. This intervention should be designed with lived experience input to build communications that best resonate with those at risk of or experiencing harm. 

As part of this work, we’ve carefully considered customers’ privacy concerns and urge firms to continue testing interventions with people with lived experience of gambling harms, ensuring they provide customers with options to opt out of analysis and targeted support, and strike the right balance between privacy and support.

What Money and Mental Health is calling for is not new – we know that analysis of transaction data has been happening in other consumer protection efforts for several years. Some firms have already been doing this work in the gambling harms space, but this is not universal. All firms adopting this approach, including those within the Gambling Harms Action Lab, will help to ensure more people are signposted to the appropriate support. 

Let us be clear: banks are not the cause of gambling harm, but they have a unique opportunity to help prevent and address it. In doing so, financial services firms can better support customers, meet their regulatory obligations and most importantly make use of their privileged lens and potentially help many more people at risk of experiencing gambling harm. 

You can read First line of defence here for more information. If you have experience of gambling harm and mental health problems, and would like to support our work, you can become a member of our Research Community.