VIPs have become a contentious topic in the e-gaming sector. At the start of 2020, The Guardian claimed to have obtained a copy of a UK Gambling Commission report regarding e-gaming VIP programmes. The newspaper focused on the operators’ apparent reliance on a small number of accounts for their deposits and the high number of problem gamblers in the ‘VIP’ category.
The Finnish operator Paf has taken the step of publishing the customer loss data to be more open about how a small number of customers can influence an operator’s results. Paf has also introduced a “loss limit”, setting a maximum annual limit on what a single customer can use.
Paf’s CEO Christer Fahlstedt explained, “The figures show that the ‘loss limit’ and our tougher measures in gambling responsibility mean that we have lost over €4 million in revenue annually from our big players. It is a lot of money. But it is unsustainable money that we no longer receive and which the whole gaming industry should say no to”.
“We can guarantee that Paf won’t have any ‘high roller’ revenue by 2020 – since the ‘loss limit’ will be fully implemented then. I can also promise that we will continue to report with complete transparency on the revenues from our various customer groups”.
Paf has reduced its loss limit further in 2020 from EUR 30,000 to Eur 25,000. It applies from 1 January. The company estimates that this further reduction in the loss limit will cost it 2% of its revenues, amount to about EUR 2 million.
Data published by Paf shows that for the period October 2018 to September 2019 the share of customers losing more than EUR 30,000 was just 0.08% of the customer base, down from 0.2% in 2017. The 0.08% lost a total of EUR 6.04 million.
The bracket of customers who lost between EUR 15,001 and EUR 30,000 contributed EUR 19.4 million to Paf’s revenues. The lower loss limit will have an impact on this category of customer in 2020.
Over in Canada, however, they are wrestling with a different VIP issue. PlayNow.com, the regulated e-gaming site run by the British Columbia Lottery Corporation (BCLC), is actually increasing its weekly deposit limit. The limit can be set by customers and the maximum weekly amount has increased substantially from C$ 9,999 to C$ 100,000.
The BCLC is trying to curtail use of offshore regulated websites and sees the move as a way “to expand its appeal and move high limit players away from unregulated, grey market gambling sites and over to PlayNow.com, providing player health, anti-money laundering and privacy safeguards.”
It explains “most PlayNow.com players play far below the new limits and will not be affected by the limit increases. In fact, more than half of PlayNow.com players set their weekly-deposit limit at $100 or less.”
The approaches adopted by BCLC and Paf highlight the delicate balancing act required in the area of VIPs and high-spending customers. Responsible gambling measures can restrict customer behaviour and there is the risk that operators who impose them simply lose the customers to other competitors who have no compunction to act in the same manner.
Raj: Of course, I couldn’t get you into the VIP section, because, you know, that’s for VIPs, and you guys are just, you know, Ps.