Before May 2018, widespread legal sports betting in the United States only existed in Nevada, which meant that if you were in any of the other 49 states you generally had two options to place wagers: The offshore market or a local bookmaker.
One of the widely proclaimed reasons that sports betting needed to be legalized and kept away from those two outlets was that bettors at legal sportsbooks couldn’t be on credit – something that could make sports betting a much more slippery slope for gamblers. Gamblers without a problem could easily develop one with access to more funds and problem gamblers could get deeper in the hole.
For example, pre-legalization, let’s say that a bettor wagered $1,000 on the Minnesota Vikings to win on Monday night and that was the entirety of the bettor’s bankroll. After losing that wager, the bookmaker could extend a line of credit to the bettor, say $2,000, and he would be able to place another wager. That all sounds great, until he risks $2,000 on another bet that loses. Now, the bettor is down $3,000 without the means to pay it back. This is when bettors get into trouble.
However, bettors in certain states and at many sportsbooks are allowed to use credit cards to fund their accounts – something that seems awfully similar. In this article, we’ll look at the current rules for using credit cards in the sports industry and what changes could be afoot in the future.
Can you use credit cards to bet on sports?
Bettors in the U.S. are able to use credit cards to fund their sportsbook accounts, but not in every state and not for every sportsbook. The one sportsbook to take the hardest stance on this has been Betr, the Jake Paul-backed venture, which banned the use of credit cards after it opened in 2022.
However, the Consumer Financial Protection Bureau published a report in Dec. 2024 that shone a negative light on using credit cards. One of the big issues raised was that for consumers using credit cards to fund their sportsbook accounts, the transaction was treated as a cash advance. This means that users could face a $10 fee to place a $20 bet, which may be the same fee as if they withdrew $200 on a cash advance from an ATM.
Credit card companies didn’t always make this fee known or were clear that consumers would be charged it. Sports betting requires bettors to win a little over 52% of the time (with a standard -110 vig) to be profitable; if they’re being charged more money to place wagers, then they need to win even more frequently to break even – something that is unlikely to happen for the general public.
More problematic, though, is that this behavior is similar to what advocates for legalized sports betting were championing pre-legalization. Bettors are able to use a credit card to fund an account (with money they don’t currently have) in order to place more wagers. If the bettor loses, he can potentially put more money in the account with a credit card, and the cycle continues. The issue arises, of course, when the consumer needs to pay back the credit card company, which also will charge higher fees off the cash advance. Cash advances don’t offer grace periods, so the high interest rate starts immediately on the advance.
The ease with which consumers can use credit cards to fund accounts is also an issue. Keith Whyte, executive director at the National Council on Problem Gaming told U.S. News & World Report that credit cards being digital “removes the immediacy of winning and losing this money. There can be a disassociation from the amount of money you're wagering or the amount of money that you've lost.”
Could changes be coming?
Funding sportsbook accounts using credit cards was banned in the United Kingdom in 2020, but things are unlikely to change in the short term. Sportsbooks won’t want to change an easy way for consumers to deposit funds, and are unlikely to change their policies unless forced to do so by regulators.
For regulators looking to pass new iGaming bills in states, the status quo is difficult to change. For states that allow credit cards to fund sportsbook accounts already, there will be political pushback to remove them, and vice-versa for states that currently have a ban on credit card deposits.
