Online casinos work on the principle of online transactions. One has to make all the deposits online to play games and then they can collect their winnings after making the withdrawals from their casino account. In order to facilitate deposits and withdrawals, the NonStopCasino online operators make a variety of payment methods including credit cards available for gamblers online.
Through this, gamblers throughout the world can make payments to online gambling platforms. Some of the widely accepted payment methods are debit cards, bank transfer, e-wallet payment options, and cryptocurrency. However, credit cards are one of the unpopular options for payment on online transactions at online casinos.
Most banks do not allow gambling transactions from credit cards due to a large number of reasons. The reasons range from legislative issues to credit card fraud. However, there are quite a few banks that allow credit card transactions realizing the full potential of the credit that gamblers tend to take from them. In this article, we shall take a look at why some banks refrain from credit cards as a payment method and how the same payment method can prove to be beneficial to the bank itself.
What are the Hidden Charges during Credit Card Transactions on Online Casinos?
Credit cards that allow casino transactions often tend to categorize credits for gambling as cash advances. Cash advances are almost the same as a cash withdrawal except for the fact that they attract a high fee. The fee for a cash advance ranges from 3 to 5%. Along with that, there is a cash advance APR that is high enough as well. Additionally, credit card transactions often come with a grace period for the repayment of the credit taken. In the case of gambling transactions, there is no grace period at all, and the interest is charged from the very next day.
The hidden charges in a general transaction include the following hidden charges:
- Maintenance charges
- Cash advance fee
- Exceeding limit charges
- Late payment charges
- Foreign transactions
- GST charges
Do Banks Care About Gamblers Who Use Credit Cards?
Credit card companies can be quite ruthless when it comes to casino transactions. They tend to charge a hefty fee when you take credit for gambling purposes. Moreover, they do not consider the reason for the credit. If a gambler is at a casino and uses his credit card to purchase a drink, the credit card company counts that as a casino transaction as well. Some credit card companies accept receipts as proof for spending on food items at a casino establishment. Otherwise, any casino transaction comes in heavy for gamblers who use their credit card.
Additionally, credit card companies consider casino transactions as cash advances thereby removing the grace period. As a result, gamblers have to pay a high interest rate along with a cash advance fee wherein the interest begins to accrue almost immediately from the time of the transaction. The interest rate on the cash advance can go up to as high as 29-30% of the amount taken as credit. Furthermore, the cash advance fee is an additional 3 to 5% of the credit amount.
Thus, keeping all the points in mind, it is easy to guess that credit card companies and banks are not quite friendly with their customers when it comes to credit card transactions in a casino. Although, on the same note, considering the fact that very few banks allow credit cards as payment methods in a gambling platform, keeping casino transactions as legitimate transactions is in itself an advantage too.
Cons of Using Credit Cards In Casinos
The cons of using credit cards in casinos are quite a many. Let us take a look at them:
- High-interest rate
- High cash advance fee
- No grace period
- No rewards or credit points
- No promotional offers
Gamblers who make use of their credit card at an online or offline casino will thus face heavy repayment terms and no rewards for the transaction as well.
The use of credit cards in an online casino is, therefore, beneficial to banks as they earn more than they lend. With the interest rates and the fee being high, gamblers have to pay back significantly more than they have borrowed from the bank.
Thus, letting credit card transactions be a valid payment method is beneficial only if the risk of non-payment or credit card fraud is ruled out. For gamblers, credit card debt from gambling can prove to be not only risky but difficult to manage as well.