Power to the kiosks: The balancing act between card and cash

Admittedly, though, this was previously done on a more casual basis. If you were clearly old enough, you could usually walk right past the bouncer, and you could probably sit down at a slot machine with no further questions asked. So, what happens when the open-door policy suddenly closes on potential customers, and where do payments come into all of this?

Well, luckily for us, we don’t need to speculate about this too much because it’s been a growing trend internationally. Amid a growing Cost of Living crisis, the Gambling Commission is framing its latest initiatives as a way to protect customers from spending money they might not necessarily be able to afford.

This has, understandably, made plenty uncomfortable with the entire process – after all, who wants to send sensitive information to an unknown entity behind a screen? While the Gambling Commission in the UK has recently received pushback on its proposed affordability checks, this level of customer vetting is certainly becoming more common across the board. However, each country does handle it slightly differently. Let’s take a look at how other countries have handled increasingly intense ID checks when it comes to payments and gambling.

Finland: To advance safer gambling as a whole

Veikkaus became the first gaming company in the world to require identification in all digital and physical channel games. The Finnish state-owned operator introduced this with lottery games in 2023, but really doubled down and applied it to all verticals this year. We reached out to Veikkaus to try to understand exactly where it was coming from when it came to enforcing such strict ID checks, and asked why it was so important for Finland to do this.

Susanna Saikkonen, Vice President for Sustainability at Veikkaus, told us: “The most important reason is to advance safer gambling as a whole. Safer gambling at a personal level means the player, for example, can see all of their gaming history and set limits to better control their gaming.” It’s no secret that scratchcards and lottery tickets can easily slip under the radar when it comes to responsible gambling, and this was one of the reasons Saikkonen emphasised when Veikkaus introduced the compulsory checks.

The ID creates a profile on the player, where they can track their spending and loss habits themselves. The focus on player autonomy in responsible gambling was a unique angle to approach ID checks from, but it certainly lends itself to a more sustainable market overall. Rather than treating them like a punishment or an invasive procedure, Veikkaus has framed enforcing ID checks as a way for players to self-monitor their behavior, especially in the ‘softer’ markets, such as lottery products.

In fact, when asked how companies could contribute to this movement, Saikkonen replied: “Just do it! It’s for the benefit of the whole industry to show real actions to advance safer gambling, and ID checks are a concreteway to achieve these improvements.”

How do these compare to global standards?

Of course, ID checks are a two-way street. The bottom line can never be ignored and Gambling Insider discussed the ID check process with Andria Evripidou, CEO of fiat and crypto banking provider XDA. According to XDA, there are countries with much more stringent ID and KYC check.

Germany adopted an electronic identity (eID) card in 2010, known as the Personalausweis, which includes a range of security features, such as digital signatures and encryption.These cards can then be used by German citizens for online banking, e-commerce, and accessing government services.

Meanwhile, XDA explains that Japan has some of the strictest regulations in the world: “Financial institutions must verify their customers’ identities using a combination of document checks and in-person verification. Institutions must also perform enhanced due diligence checks on high-risk customers or transactions. They are also obligated to report any suspicious transactions or activities to the authorities, and are seen as a key contributory role in the detection and prevention of money laundering and terrorist financing.”

The Netherlands: duty of care and all that comes with it

The Kansspelautoriteit, or Dutch Gaming Authority (KSA), is due to publish its new set of Responsible Gaming Policy Rules this summer. The majority of the rules will come into effect on 3 June, but there are a handful on the analysis and registration of behaviour that will go live on 1 October. As part of this, customers will be asked to undergo enhanced identity and affordability checks if they deposit more than €700 ($760) in a month, or €300 if the customer is aged between 18-24 years old.

Perhaps the most interesting aspect of the new Responsible Gaming Policy Rules was the timed expectations from the Authority. Rather than assuring that potential harmful behaviours would be flagged, the KSA outlined that “the software or the responsible employee of the license holder must be aware of such a signal or suspicion within an hour,“ meaning that any addictive or problematic behaviours should be signposted within 60 minutes.

The KSA explained that “this is in line with the study’s observation that many providers do not monitor ‘real time’ and sometimes notice signals too late, which can cause players to suffer large losses in a short period of time.”

Naturally, then, one of the best ways this can be ensured is by having strict ID checks in the first place. By registering and analysing player data for early identification of possible risky gaming behaviour, a player profile can be built, allowing for tailored responses by gaming officers. This would affect the severity of the response or intervention, by giving those responsible all of the information needed to make decisions immediately – or in this hour outlined by the KSA.

When asked for a comment on this, the KSA told Gambling Insider its priorities with requesting ID checks for players were: “To be compliant with their duty of care and all that comes with it: for example, to prevent underage gambling, to check with the exclusion register and monitor player behaviour or affordability.”

ID verifications are not being rolled out consistently

It’s one thing for companies and authorities to agree with such protective measures, but it’s another thing to actually put these systems into place. With more customers than ever asking why their details are needed just to access an online casino, Evripidou provided a sound explanation of why ID checks are becoming seemingly more intrusive: “As businesses embrace a rapidly evolving digital landscape, so have fraudulent and criminal opportunists.

In an effort to combat growing levels of financial fraud and crime, countries are introducing increasingly robust identity verification procedures for online payments and financial transactions.

However, new ID verifications aren’t being rolled out consistently. Regulators around the world are taking different approaches when creating and enforcing these ID checks. Often, their methods are a reflection of their regulatory environments, cultural norms and technological advancements.”

XDA also laid out the three main types of ID verification that are commonly used around the world, those being digital identity verification, two-factor authentication and biometrics. These escalate in both security and depth, although alongside this they also require more information from the customer.

While it can be easy to pose as someone else online, it’s very difficult to convince a fingerprint scanner or facial recognition software… But when it comes to something like online gambling, how far are customers willing to go before they simply try registering with another casino

New Jersey: Players are protected from victimisation

It wasn’t just gambling commissions in Europe that we reached out to discuss this with, though. Even though online gambling isn’t as ingrained in North American culture as it is over here, it’s still important to get a cohesive view of the global changes to ID checks.

When asked what their priorities were, the New Jersey Division of Gaming Enforcement (NJDGE) told Gambling Insider: “Through ID and KYC checks, players are protected from victimisation against illegal gambling operations that, for example, may seek to use stolen identities to advance their enterprises, and are provided with responsible gaming resources and messaging, as well as other consumer protections. In addition, these checks help to ensure that responsible gaming tools are employed and working correctly. All of these factors serve the most important interest of player protection.”

Of course, if you know anything about gambling in the US, this isn’t a surprising answer. Even though New Jersey was one of the first states to legalise gambling in the modern era, signing the Casino Control Act into law on 2 June 1977, there was still plenty of public discourse about the dangers they could bring. Casinos and gambling as a whole have always had a ‘root of all evil’ stigma to them, so it’s only natural that the NJDGE then reflects this in everything it does, down to the reasons behind the ID checks. The emphasis is on guiding players towards legalised and regulated gambling experiences, where additional protection then can be employed.

A global identifier united by player safety

It would be obnoxiously obvious to say ID checks in payments and withdrawals related to gambling were for ‘player safety,’ which is why it was so insightful to see how this one procedure reflects the biggest concerns for each country’s gambling commissions. There is an argument that says a country’s morals dictate the laws it upholds, and yet this could not be clearer with the above.

The UK is in a cost-of-living crisis, so the ID checks are explained as protecting a customer from overspending; Finland is dissolving its current monopoly system to introduce a licensing model, so its ID checks are a way to support player self-regulation in a time of great change; The Netherlands is tightening laws on gambling, so its ID checks are a way to streamline an appropriate and tailored response; and finally, New Jersey has to uphold the image of casinos being safe and legal, so its ID checks are there to reassure public trust. As gambling laws around the world become more refined, it’s guaranteed that KYC and ID checks will become more in-depth; however, the specific reason each country gives is still yet to be seen.

What does the future of ID checks look like?

With all eyes on the casino industry and lawmakers around the world tightening up as many gaps as they can, it’s only natural to wonder how far security and identity checks will go. For some customers, they are already asking for too much, so how can this be navigated going forward?

We asked XDA its thoughts on this and Evripidou replied: “Today’s world is largely reliant on the collection, transfer and storage of personal data. Naturally, the protection of personal data has become a paramount concern for individuals, businesses and governments alike. As data flows across borders, organisations must ensure compliance with relevant privacy regulations and international laws.

“Although the UK has recently been at the centre of debates regarding the types of identity checks it aims to impose on customers, their actions are part of a global effort to implement robust ID verification checks. Effective use of ID checks for payments is a crucial step in combating financial fraud and identity theft, and there is little doubt that these methods are here to stay.

The UK, Germany and the US are among the countries that have made significant strides in implementing robust ID verification processes, including digital verification, biometrics and multi-factor authentication. The use of KYC and AML processes is also widespread, with international organisations like the Financial Action Task Force providing guidelines and recommendations.

“The implementation and enforcement of regulations vary significantly across the globe. As the world becomes increasingly digital, it is essential that countries prioritise the protection of personal data and ensure compliance with relevant privacy regulations and international laws. At some stage, countries may need to work together at a closer level, to close any remaining gaps that emerge through these globally fragmented solutions.”

Really, that seems like the most important thing to take away from this. With more regulators, operators, governments, payment providers and everyone else in between all putting new systems into place, it could become very messy very quickly. International compliance is already a sensitive topic in the gambling industry and if organisations aren’t careful, this could easily become a similar issue, especially with how much sensitive information and data is involved with identification checks.

 However, if there is even a basic level of communication between global institutions, the entire ID and KYC network could become stronger than ever going forward. All eyes on ID…