Senator to Introduce Pennsylvania Gaming Credit Card Ban
Fontana Says Other States Have Similar Rules
Pennsylvania State Senator Wayne Fontana is planning to introduce legislation that will prohibit the use of credit cards for online sports gambling, iLottery, fantasy sports, and online casino play. He sent a memo to colleagues asking for co-sponsors to his bill on March 6. The senator believes a Pennsylvania gaming credit card ban is needed to help keep credit card debt down.
In his memo, Fontana noted March is “National Problem Gambling Awareness Month.” He believes the expansion of gambling in the Commonwealth could lead to more people with gambling disorders.
“In fact, over 36% of online gaming participants in the commonwealth reported at least one gambling problem according to the 2022 Online Gaming Report produced by Pennsylvania State University in coordination with the Pennsylvania Department of Drug and Alcohol Programs as well as the state’s Gaming Control Board,” he wrote.
Fontana said gambling and credit card debt are often linked. He believes not allowing people to bet online with credit cards could help. “With the average Pennsylvanian having a credit card balance that exceeds $5,640, online gaming should not be another scenario to accumulate more debt,” he wrote.
Sports gaming is a big business in Pennsylvania, which charges a 36% tax on sports betting revenue. That hasn’t stopped sportsbooks from entering a lucrative market, however, as Pennsylvania has 13 sportsbook operators. Even after paying the excessive tax, the sportsbooks still showed more than $60 million in profits for January. It’s unclear how much a Pennsylvania gaming credit card ban would hurt those amounts. People prefer to bet online when it comes to sports betting. Monthly reports show everyone, from novice bettors to experienced handicappers, with their betting odds calculator by their sides, will place online bets when given the chance.
Other States Have Credit Card Gaming Ban
If the Pennsylvania gaming credit card ban eventually becomes law, the state won’t be in unchartered waters. Iowa, Tennessee, and Massachusetts already prohibit the use of credit cards for online gaming. Globally, the UK instituted a similar credit card ban in 2019, and Australia is looking to do the same.
“Online gaming and sports betting is growing exponentially, especially with young adults,” Fontana said. “At the same time, credit card debt is climbing. So we need to make sure the greater access to gambling isn’t leading to burdensome or crippling credit card balances.”
Is Betting or Inflation Driving Credit Card Debt?
Fontana states that Pennsylvania’s average credit card is 12% higher than pre-pandemic levels, but it’s more of a national problem. Credit card debt isn’t restricted to states allowing the use of cards for gambling purposes. The Federal Reserve Bank of New York reported a U.S. credit card debt of $1.13 trillion through the fourth quarter of 2023. That’s easily the highest amount since the Federal Reserve began tracking credit card debt. The average credit card debt for Americans is $6,864.
High interest rates are a big factor in credit card debt, with the average rate for new cards 24.44%. Existing credit cards have an average interest rate of 21.47%. Nearly two-thirds of credit cards have a balance carried forward on a monthly basis. Fontana’s proposed legislation may be well-intentioned, however, it doesn’t take the national problem of credit card into consideration.
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