Question Online gambling and credit rating

gerilege

Meister Member
PABrogue
PABnorogue
Joined
Mar 9, 2006
Location
Hungary
Hi Fellow CM members,

I was wondering if any of you faced any negative consequences of responsible, legal online gambling activity. Credit rating may differ country by country, so please also include some information about those aspects as well. In my country there is a central rating system that functions rather like a blacklist, and there is no 'positive' list unlike some other countries I am aware of. Answers from Europe would be particularly helpful as I am banking at a multinational European Bank.

The reason I am asking is the following. I know that I am not on the blacklist as I can also do a query for myself. I had recently applied for a simple short-term loan where I have been told that the process would be rather just administrative with my background at that bank. Still, my application turned out to be declined. I would not share more details on a public forum, but I would like to ensure you that this decline was a surprise for a couple of people involved.

Now in my country there is no obligation for banks to tell the customer the reasons for a decline, but I still wanted to understand way. So I have collected some information from the communities I was part of a couple of years ago and there are good reasons to believe that some banks may consider any online gambling transactions as a no-go for certain products they offer to their customers, though online gambling is legal in my country in regulated casinos.

This issue is not a big deal for me, but as it was rather surprising I thought I would ask for experience in the community here in potentially similar matters.
 

wms

Newbie member
Joined
Nov 21, 2018
Location
Finland
I have worked in a bank in Finland so I can answer this from my country perspective.

If you take a small loan 500-10 000 without loan guarantee we just look how much there is left after every month. (how much you have left every month from your salary)
For bigger loans, we tend to look deeper on how the customer uses his/hers money. There are many variables that we take to account but generally I can say this:

If you are using 15% of your salary to gambling you are in the possible risk group, we are not going to decline you but look further into your application.
If you are using 25-30% of your salary to gambling you are classified as a risk. There is a really high decline chance here.

I hope this helps.
 

SpinUk

Meister Member
PABnonaccred
MM
Joined
Oct 10, 2012
Location
London
For the UK, from a credit record perspective there is no record of spending per se, this records regulated borrowing only.

However, in practise when applying for credit, lenders are obliged to prove affordability. This is where your application can fall down if from the past 3 months bank statements you are using the bulk of your income on gambling.
 

snorky510238

Chief glockenspiel maker
Joined
Jan 12, 2018
Location
Uk
Gambling via your bank account definitely affects your chances of obtaining credit. Even the biggest sharks out there ie payday loans, log book loans etc are likely to decline if you regularly deposit. They are bound by law to do thorough checks as they could be found liable if they lend irresponsibly. It must hurt them like hell as there was a time when they just lent ‘willy nilly’ and raked it in. From the customers point of view I think it’s a good thing for sure as I know from my younger days that borrowing money to gamble NEVER WORKS.
 

pinnit2014

Meister Member
PABnoaccred
mm1
Joined
Dec 13, 2014
Location
Glasgow and Home - N Ireland
Well with opening banking, if you sign up, don't be expecting too many offers from financial institutions;)

As Spin says - if you're applying for a Tesco Credit card i can't see how it affects but if you're having a mortgage lender pour over your expenditure before making a decision, not so much.
 

gerilege

Meister Member
PABrogue
PABnorogue
Joined
Mar 9, 2006
Location
Hungary
Thank you all for your valuable input.

It was never my intention to gamble borrowing money. I asked for a loan without guarantee (other than my regular salary arriving to my bank for 15 years now) for about 7 times my monthly salary as we needed to re-organize a couple of things in the family. We have savings higher than that, but it would have been overall a better option to overcome the situation via a short-term loan. We were able to mitigate relatively easily in the end. I made deposits of about 15% of my monthly salary on average in the last 3 months, but withdrawals exceeded that. Earlier, deposits exceeded withdrawals, but the bank obviously does not know that these were still +EV attempts failing (I do not go after +EV as regularly as I used to, but go a bit more for the entertainment value as well).

I started this thread because I do not remember this topic discussed here before, but I think it is an aspect of gambling worth talking about because, at least as I learnt:
- certain bank business processes or rules may override other processes during loan application in this situation. If you gamble an amount you either consider affordable or you happen to be able to go after occasional +EV opportunities with higher amounts, this might backfire should an unexpected life situation occur. Luckily not in my case, but it could have been worse.
- another interesting angle to look at it is to test whether the above processes would pass the requirements of 'equal opportunities' regulations that are in place in most European countries (assuming gambling is legal in that country). The law usually also categorizes the case of "receiving a less favorable treatment due to any other reason of one's situation, characteristics or trait than another person or group in a comparable position received, would receive or would have received" as a direct negative discrimination. In such 'equal opportunities' legal processes usually the burden of proof is reversed, the bank would need to prove that they did not make any of the alleged discrimination. The bank may argue that those who gamble are not in a comparable position to those who do not gamble as they are in a different risk group. On the other hand, the individual could argue that the bank is penalizing customers based on extra information they have - as opposed to people who simply withdraw their cash and spend 15% of their income on alcohol. Or, - and this would be especially tricky for the bank if they consider older transaction history for their own customers - for instance, take an existing customer and a net new customer. The last time both customers gambled were 4 months ago, and both need to provide a bank statement for 3 months. Now the bank would need to explain why these two people in comparable position were treated differently.
 
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