Negligence in checking the creditworthiness of gamblers
The Guardian reports that British financial institutions lend up to £174 million (approx. 100 $million) to problem gamblers every week [Article on English]. This would have resulted from an investigation into the market situation.
In this context, the credit company Abound carried out an analysis of its customer data supported by artificial intelligence and came to the conclusion that the award criteria for loans to gamblers were often inadequate:
Currently, lenders are doing nothing wrong. But the tools they use, such as credit scoring, are outdated and fail to identify many financially vulnerable potential borrowers in the online age. – Gerald Chappell, CEO of Abound, Source: The Guardian
According to Abound, the company provides loans to 550 people every week. Another 230 would be rejected due to excessive gambling spending. Of those rejected, however, 15% managed to obtain loans from other companies.
This is due to the fact that Abound sets itself high standards for credit checks. But since it already is There has been no progress on British gambling reform for months [Article on English], the official regulations for lending to gamblers have not yet been tightened.
Are the credit institutions putting people's lives at risk?
A gambling addiction can not only plunge those affected into financial ruin, but in individual cases even lead to suicide [Article on English].
Gambling with Lives, a charity founded by families of victims of gambling-related suicide, is campaigning for tougher rules, better controls and help for those affected and their families.
The organization recently partnered with the British Samaritans campaigned against the trivialization of a connection between suicides and gambling addiction [Article on English]. Gambling with Lives' Will Prochaska criticized the industry's attempt to hide "hundreds of deaths every year."
It remains to be seen whether the British government will take quick action from the data obtained and how the long-planned gambling reform in Great Britain will develop in general.
According to experts, the ban on credit card payments for gambling that applies in Great Britain does not seem to be sufficient to stop debt-financed gambling addiction.
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