While U.S. states got the nod from the Supreme Court to allow betting on sporting games, it still faces challenges as to how those bets are placed.
According to a report in Bloomberg, gamblers may not be able to place bets via a credit card, since the largest credit card issuers – including JPMorgan Chase, Citigroup and American Express – don’t allow it. But that doesn’t mean they aren’t paying attention to the ruling.
Mary Jane Rogers, a spokeswoman for JPMorgan, told Bloomberg in an emailed statement that the bank will “closely watch developments from the ruling and will consider any implications to our policy as the states put their own processes in place.”
With consumers betting $150 billion illegally on sports games each year, getting a piece of that could be enticing for the nation’s credit card companies. But enabling consumers to bankroll a gambling habit on credit could result in defaults for which the lenders would be on the hook.
Backers of the state’s gambling initiatives want the credit card issuers to allow it. The report noted that for years, payment processors – including Worldpay and payment networks such as Visa and Mastercard – have been working to allow credit card transactions for betting. Bloomberg noted that they are now educating the banks on how they can change their policies in light of the Supreme Court ruling.
“We are working with the card schemes – meaning Visa and Mastercard – on really putting together a SWAT team and really working with the issuing banks,” said Joe Pappano, a senior vice president at Worldpay. “Issuers have to modify their real-time decisioning tool, they have to update policies, they have to feel confident that the compliance and the framework and those consumer protections exist.”
He argued that credit card issuers will rethink their stance when they see how big the market is. “The issuers now have an opportunity that they’ve never had before,” he said.