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Credit card charges hit gamblers the hardest

Fri, 30 Sep 2005

Stealth credit card charges are being added to cardholder's accounts if they enjoy a bit of gambling.

Credit card providers such as Alliance and Leicester, Abbey and Virgin Money are charging on average £2 for each transaction if they place bets online or in casinos. Lenders justify such charges by putting gambling down to being a cash advance and they are also imposing large withdrawal fees.

An Alliance and Leicester spokesman said, "When paying for gambling, customers are essentially buying cash rather than any product. Because their stake is de facto cash, we treat the transaction as a cash advance."

Bets are likened to cash machine withdrawals where a £2 or 2 per cent commission is charged, depending on which one is higher.

Samantha Owens of data analysts Moneyfacts said, "Some customers may consider a gambling stake to be cash, but others may think of it as a purchase. Our advice is to check with your provider what they categorise as cash."

A transaction that is considered to be a cash advance will also be subject to interest charges at higher rates. These charges will apply from the date of the transaction rather than the date of the next statement.

However there are other credit card providers who do not treat gambling as cash advances so they do not charge extra. These providers are Barclaycard, Halifax and HSBC.
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