Find out exactly what it will cost if you use your credit card for a gambling transaction.
Credit cards can seem like a convenient option when you want to place a bet, pay for a lottery ticket or go to a casino, but this is not always the case. Most credit-card providers treat gambling transactions differently to everyday purchases, and some don’t even allow you to use your card to gamble. We look at the rules around using a credit card for gambling transactions, including providers that won’t allow them, as well as alternatives to consider.
Compare credit cards that allow gambling transactions
What is considered a “gambling transaction”?
While personal definitions of “gambling” vary, for legal purposes, the definition includes:
- Sports betting
- Casino games/tables
- Gaming machines (i.e. poker or slot machines)
- Poker games
- Lottery tickets
Gambling transactions are payments that relate to these services and activities. It’s worth noting that you can gamble in person or online. For example, you could buy a scratchie at a newsagency or place a bet at a TAB venue in person, or you could go online to play poker or pay for your lottery ticket. Regardless of the medium, these activities are classified as “gambling” and there are rules around how you can use your credit card to make payments.
Using a credit card for gambling transactions
Most credit card providers allow you to use a credit card for gambling. However, these transactions are usually classified as “cash advance transactions” and the following conditions apply:
- A cash-advance fee is charged. This fee is usually between 3-4% of the total transaction cost. For example, if you use your credit card to place a $500 bet, you can expect to pay an extra $15 to $20 in fees.
- The cash-advance rate of interest applies. These types of transactions attract the cash-advance interest rate. This is usually the highest standard rate on a credit card and is typically 18-22% p.a.
- No interest-free days. Interest-free days don’t apply to this type of transaction. ou will be charged interest on the balance of your gambling transaction from the day it is made until it is paid off in full.
- No rewards. You won’t earn rewards on gambling transactions or other cash-advance transactions.
Regular transactions at gambling establishments
In some cases, these conditions may also apply when you use your credit card for regular purchases with a merchant that offers gambling services. For example, if you buy drinks with a credit card at a casino, the transaction may be processed as a “cash advance”.
This is because credit-card providers are only able to determine whether or not a transaction is a “cash advance” based on the information provided by the merchant and the financial institution that processes the payments. Check with your credit-card provider or the venue for clarification on whether or not your payment will be considered a cash advance. Or consider an alternative option such as cash or a debit card.
Credit-card providers that don’t allow gambling transactions
The following credit-card providers explicitly state that you can’t use your credit card for gambling transactions:
These providers all list details of restricted transactions in their credit-card terms and conditions, stating that “cardholders must not, or won’t be able to, transact…for the purpose of gambling”. This means that if you try to make a gambling transaction using a credit card from one of these companies, it may be declined.
Alternatives to using a credit card for gambling
There is a range of ways to avoid the fees and restrictions associated with using a credit card for gambling transactions. Some other payment options to consider include:
- Debit cards. These cards give you access to your own funds, and don’t incur an interest charge or cash advance fees for gambling transactions. If you have a MasterCard or Visa debit card, you can also use these for online gambling. Note that some debit cards may restrict this type of transaction. Check the terms and conditions of your card before using it.
- Cash. If you are making a gambling transaction in person, cash is a convenient option. Most venues such as TABs venues, casinos and racetracks have ATMs nearby.
- Electronic payment options. When gambling online,consider an electronic payment option such as PayPal. This will allow you to choose which account you want to access, as well as a means of paying for international transactions.
Using a credit card for gambling transactions can be complicated and expensive, with terms and conditions varying between providers. Make sure you check the conditions before gambling, and consider other options so you can choose a method that’s convenient and affordable.Back to top