How you could offset the costs of Point of Consumption Tax

It’s widely understood that the various upcoming changes to regulation, including The Gambling Tax Reform, will have a significant impact on the gaming sector, potentially increasing costs and intensifying competition. At the same time, expanding in to new global territories is at the forefront of many providers minds.

The Gambling Tax Reform which is due to come into effect on the 1st of December 2014 will require providers to ascertain when a player is based in the UK rather than any other international region in order to comply with the proposed Point of Consumption Tax (POC) from the HMRC.

With this change in regulation, it’s likely that your customer verification checks will change too, adding to the already complex and diverse identity verification processes and requirements that you may already have in place for the different global markets you operate in.

HMRC highlights that customer verification checks, when the reform comes in to place, will require you to “ask your customers whether or not they usually live in the UK and collect and analyse data to verify what the customers tell you”.

So, what does this mean for your KYC checks?

With POC tax likely to increase operational costs, providers will be looking to manage their expenditure more effectively in order to offset the added financial burden of new legislation. They’ll need to achieve this whilst successfully ensuring their systems and practices leave them best placed to comply with existing and new legislation.

One area of focus for offsetting on-boarding costs will be to better manage the impact that chargebacks to credit cards have – which is still a real bug bear for many providers. However, it is an area where cost and efficiency savings can be found, should the right checks be in place.

Solutions which link the ownership of a bank account or credit card to an individual up-front helps to; minimise payment fraud, reduce costs and improve the efficiency of on-boarding through reducing the reliance on more manual verification methods.  It means that operators can win more customers and get them playing quicker – as well as helping with fast and secure winnings pay-outs, which often underpin customer loyalty.