Why Licences Exist
A licence from a reputable regulator ensures that the casino operator has to adhere to a set of regulations issued by that regulator. Without a licence, casino operators have almost unlimited power over what they can do with the games and the money of the players. Any licence from a credible regulatory authority means that they must adhere to these standards, or they will lose their licence and their entire business.
The UK Gambling Commission has issued settlements totalling over £250 million between 2020 and 2024 with licensed gambling operators. These funds are to be directed towards socially responsible causes. The very same regulatory authority that forces licensed operators to adhere to a set of regulations will protect you with every deposit that you make to any licensed casino.
6 Things a Licence Protects You From
Withheld Winnings
Licensed casinos have to pay legitimate winnings to their players. If the licensed casino refuses to pay a player without a valid cause, the player can escalate the issue to an Alternative Dispute Resolution (ADR) provider that is licensed under the UKGC or MGA regulations. The ADR will make a binding decision for the dispute that will have to be adhered to by the casino. For example, IBAS, the primary ADR provider for UKGC licensed casinos, receives hundreds of disputes each year. Casinos must adhere to these ADR awards or they will face action from the UKGC or MGA regulators.
Rigged Games
Licensed casinos have to use Random Number Generators (RNGs) that are audited by third-party testing agencies. These tests ensure that the machines pay out the percentage that they publish as their Return to Player (RTP) percentage. For example, a licensed slot machine that publishes an RTP of 96% will pay out £96 for every £100 that is wagered on the slot machine over a vast number of spins. Unlicensed casinos have no such obligation to publish an RTP percentage.
Lost Funds if Casino Closes
Licences from the UK Gambling Commission (UKGC), MGA, Gibraltar and Isle of Man regulators all require licensed casinos to hold the player's funds in a separate account from the business. The UKGC also makes distinctions between three levels of protection for these funds: basic, medium or high levels of protection. The higher the level of protection, the more the funds are held in a trust or insurance company that will pay the player if the casino becomes insolvent. This does not typically apply to casinos that hold Curaçao licences.
No Complaints Route
All licensed casinos are required to appoint an ADR provider. If the customer service department of a licensed casino is unable to resolve the customer's issue, the player can escalate the issue to the ADR provider. For example, ADR providers such as eCOGRA take between 30 and 90 days to resolve disputes between the player and the casino. IBAS can take between 4 and 6 months to resolve disputes. The ADR provider will award the player with a judgement that the casino has to adhere to, or else they will lose their licence. At unlicensed casinos, the only option for a player to resolve an issue is to take legal action abroad - an option that is impractical for players due to the low amount of funds that they typically have.
Predatory Marketing
UK Gambling Commission rules limit the way that casinos advertise to their players. For example, bonus offers must be described in detail and promotions cannot be misleading. Casinos cannot advertise to players who are self-excluded from gambling or who demonstrate any signs of problem gambling behaviour. For example, in 2023, the Advertising Standards Authority received 17 complaints from players about misleading bonus offers from casinos. These rules do not apply to unlicensed operators.
No Problem Gambling Support
Licensed casinos have to offer players the ability to set deposit limits, gaming session limits, self-exclude from the casinos, and use reality checks to stop gambling after a selected time span. All UKGC licensed casinos have to use GamStop, a self-exclusion registry that has over 250,000 registered self-excluded players as of 2024. If a player registers on GamStop, every UKGC licensed casino has to close the player's account within 24 hours. Unlicensed casinos do not have to adhere to this regulation. This is another reason why problem gamblers seek out unlicensed casinos. The regulators take this issue very seriously and take action against unlicensed operators who advertise to self-excluded players. For the full set of protective tools, see our responsible gambling guide.
What a Licence Does Not Protect You From
A licence from a reputable regulator does not guarantee that a licensed casino will provide an unparalleled player experience. Some of the licensed casinos have slow withdrawal processes, poor customer support, and poor bonus offers. A licence from a regulator may protect you from certain problems, but it does not promise an excellent experience.
The licence does not protect you from losing your money to the casino. The casino has a built-in house edge in all of its games. European roulette has a 2.7% house edge. American roulette has a 5.26% house edge. All slot machines have a RTP between 94% and 96% meaning that the house gains 4 to 6 pence on every pound that is wagered over a vast number of spins. The licence does not change these figures, but it does ensure that the percentages published by the casino are the percentages that the player will experience.
The Difference in Practice: A Real Example
A player deposits £200 into an unlicensed casino. The player wins £800 but is refused access to their winnings. The casino asks for a variety of documents to prove the identity of the player, then makes demands on the player that were not described during their registration into the casino. The player cannot escalate the issue to any ADR provider because the casino is unlicensed and does not have segregated player funds. The only options are to attempt to reverse the transaction on the player's card or to take legal action abroad. Both options are impractical for most players due to the small amount of money that they have.
The same scenario plays out at a UKGC licensed casino. If the casino refuses to pay the player any winnings, the player can escalate the issue to the ADR provider for the casino. For example, IBAS will investigate the player and the casino and make a binding judgement in the dispute that will have to be adhered to by the casino. This process takes between 4 and 6 months to complete and is free of charge for the player. The player's £800 will be paid out to the player. The unlicensed casino player's deposit does not have a route to recovery.
Check the Licence Before You Deposit
See our step-by-step guide: How to check a casino licence in 5 steps, and learn how to spot a fake casino licence before you register.
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