MBNA gambling charge

S

Shadowdude

Registered User
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10
Hello fellow online gamblers,

Has anyone else noticed MBNA's new 'terms and conditions' and susequent charge? Now, everytime you deposit to an online gambling site (such as Paddy Power or Boylsesports, etc.), MBNA will treat it as a cash withdrawal and charge 2.50 euro or 1.5% (whichever is greater).

I only noticed it when I logged into my MBNA account on Monday. I am not a big gambler at all. I do some horses on a Saturday. I might start and deposit 20 euro, see how I go, then maybe deposit another 10 euro etc. So there I was on Monday looking at 4 charges of 2.50 euro each for depositing into my Paddy Power account. (Most of my deposits were 10 euro).

When I called MBNA, they told me they recently changes their terms and conditions. They also suggested I deposit more into my paddy power account (?) to minimise the new charges.

Does anyone else have a problem with this? I do. Firstly its unethical to encourage people to gamble more and secondly this charge hits the small gambler far more than the big gambler (a regressive type of tax). A person depositing 200 euro won't care so much about the charge. The person depositing the small amounts is really going to see it build up.

I told MBNA that I would likely by cancelling my account (after being with them for 10 years) but they didn't care. If one credit card company starts this then they all will. Whats next? Surely a mobile top up with your credit card is the same then as a deposit into your online gambling account. Will there be a new charge for that next?

I know there is a recession on and I don't mean to offend anyone who is struglling with money by complaining about a gambling tax as such. I'm not a big spender at all, I just like a small gamble at the weekend.

Would love to hear anyone else's thoughts.
Shane
 
Hi Shadow

Were the revised terms and conditions sent to you in hard copy?

Was this new charge highlighted?

Have you read the terms and conditions? Did you notice any other change?
 
Hi Brendan,

Yes I did receive the new terms and conditions but I didn't read them. It was several pages of small writing and I just assumed it was an interest rate change or something else minor. So I put them in the bin. Yes I know I should have read them! :)

What gives MBNA the right to decide what is a 'cash transaction' and what is not?! I actually hope the Paddy Power and the rest of the gambling companies go after MBNA on this and encourage their customers to change their credit card company. Rip off republic is supposed to be dead at this stage.
 
When withdrawing funds from Paddypower you can request a cheque.

You could, therefore use your credit card to lodge funds and immediately withdraw by cheque.

I think this is what the credit card companies are trying to combat.

I don't know about any of the other online gambling sites.

It is more the fault of PaddyPower for allowing this to happen.
 
callybags said:
When withdrawing funds from Paddypower you can request a cheque.

You could, therefore use your credit card to lodge funds and immediately withdraw by cheque.

I think this is what the credit card companies are trying to combat.
Click to expand...

Why would they want to combat that though? You're still spending money using your credit card which is what they want...
 
Hi Callybags,

The problem is that each time you put money into your paddy power account, MBNA charge you €2.50 or 1.5%. It isn't anything to do with witdhrawing money.
S.
 
I expect that the reason for this charge is simply that MBNA have done their research and concluded that most users of gambling sites are sufficiently attached to this pastime that they will continue with it even at the cost of greatly increased transaction charges.

If this works well for MBNA, other card issuers will probably follow suit. Then they will figure out that they could probably do the same thing if they surcharged all payments made for lapdancing clubs, alcohol ( at least in nightclubs), pornography and so on: - really for anything where the customer is not that terribly price-sensitive.
 
That's presuming that the providers of these services are prepared to allow themselves to be associated in the public eye with the likes of MBNA. ;)
 
Yes indeed...."Pole Dancer reveals her MBNA shame" may well be a future red-top headline
 
Shadowdude said:
What gives MBNA the right to decide what is a 'cash transaction' and what is not?!
Click to expand...

MBNA do not decide what is and what is not a cash transaction. Visa and Mastercard decide. These gambling transactions are what are called quassi cash transactions. Both schemes treat such transactions as CASH transactions. MBNA are well within their rights to charge such a fee and have obviously not decided to do so until now.

The reality is that there is no difference between withdrawing cash from an ATM and lodging what is essentially cash into a betting account....

The risk profile should not be treated any differently then a cash withdrawal, yet people have no difficulty charging such a fee on a ATM transaction.

Condsider yourself lucky you can perform a betting transaction on your credit card. In the US, you are unable to bet using a credit card. In the medium term this should not happen here.

For once, top mrrks to MBNA, remember we are no longer living in good old Celtic Tiger......risk now is the name of the game and how to contain it.

I do hope other issuers out there follow the lead.
 
Hi Blackberry,

I fail to see what your point is about 'risk'? How is MBNA exposed to risk in this instance?
As for encouraging other issuers of credit cards to follow suit, have you not considered the regressive nature of the charge itself? It really impacts on the small gambler more. Surely there is a fairer way to charge people if such a charge is to become a permanent feature in Ireland?
 
Hi Shadowdude,

I do appreciate your point about the smaller gambler and you are correct, however I would guess are more interested in targeting the much bigger gambler.

With respect to risk, of course there is a bigger risk and that risk is the risk of default.
 
Blackberry said:
The reality is that there is no difference between withdrawing cash from an ATM and lodging what is essentially cash into a betting account....
Click to expand...

How soon does the Gambling company get the money ?If its not any sooner than a retailer does then how can it be seen the same as an ATM cash withdrawal? The customer always gambles that the product will be suitable when buying.... whether it be a car, a expensive laptop or some gambling credits.
 
bullworth said:
How soon does the Gambling company get the money ?If its not any sooner than a retailer does then how can it be seen the same as an ATM cash withdrawal? The customer always gambles that the product will be suitable when buying.... whether it be a car, a expensive laptop or some gambling credits.
Click to expand...

The Bookie, will receive the money in the same way as any other merchant.
However that is of no concern to the Card Issuer. They are only interested in getting back the funds advanced to the cardholder.

The funds are the same as cash because what the cardholder is doing is pre-funding an account with cash to conduct gambling transactions. Also remember bookies can alllow punters to withdraw funds by other means.
 
So then is buying phone credit 'funding an account' also? Shouldn't MBNA charge people 2.50 euro each time they top up ten euro? Its the same principle.
 
Blackberry said:
The Bookie, will receive the money in the same way as any other merchant.
Click to expand...

So they have no justification for charging a cash advance fee because its not a cash advance.


Blackberry said:
However that is of no concern to the Card Issuer. They are only interested in getting back the funds advanced to the cardholder.
.
Click to expand...

The cardholder MBNA in this case is only interested in finding an easy target to levy more fees upon. This is no special case apart from the support they will get from campaigning anti gambling people which they will use cynically to their advantage. Tell me one case where a card company is not interested in being repaid by its customer (so long as that customers not a politician).



Blackberry said:
The funds are the same as cash because what the cardholder is doing is pre-funding an account with cash to conduct gambling transactions. Also remember bookies can alllow punters to withdraw funds by other means.
Click to expand...

The funds are not the same as cash. The cardholder is prefunding the account with credit, not physical cash. The gambling company does not get cash any faster than any retailer. The gambling company is doing the customer a favor by not making him wait for the money to clear. This is in line with the favor every retailer does for a customer. This is the principle of credit which every customer with a card uses with every retailer. Any cheque of winnings issued by a gambling company will be paid out of the gambling companies own money before the card company pays that gambling company because like every retailer they have to wait the same amount of time for payment as the computer company whos customers gamble that the expensive laptop purchased was right for them. IMO if card companies are claiming they are prefunding with cash then the gambling companies should insist on receiving cash immediately into their accounts.

Its just another cynical way for the already overly expensive credit card companies to charge a fee. It wont stop gambling but it seems to give some shadenfreude to those who are antigambling to see someone who enjoys placing a small bet being hit for even more charges. One issue campaigners wont care about the methods of charging so long as the little guy gets his share of damnation for having any dealings with a gambling site.
 
I called MBNA, they said they sent me a letter about the new charge (never saw it)

They said all credit card companies in Ireland are charging this charge so they are bringing themselves into line with the rest of them.

I only used it to play lotto on lotto.ie.

I was furious!, for sure will not be gambling with my credit card again.

I check my MBNA card online every week and they could easily have updated their website do let their customers know. For sure there are others who have been conned into paying the fee.
 
Brendan said:
Hi Shadow

Were the revised terms and conditions sent to you in hard copy?

Was this new charge highlighted?

Have you read the terms and conditions? Did you notice any other change?
Click to expand...

I also have to say I honestly did not get the terms and conditions, (or any letter from them) They could have easily updated their website with the new terms and conditions.
 
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