Using a credit card for gambling

Know when you can use your credit card for a gambling transaction and what it will cost you, including for lotto, TAB and Sportsbet.

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By

Amy Bradney-George

Updated

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If you want to place a bet on the Melbourne Cup, pay for scratchies and lottery tickets or play poker online, credit cards are usually very expensive. Most credit card providers categorise gambling transactions differently to everyday purchases and charge high rates (up to 29.99% p.a.) and fees for them. Others don’t let you use your card to gamble at all.

In fact, credit cards have been banned for gambling in-person at hotels, clubs, casinos and TAB outlets since the early 2000s. Credit cards can still be used to gamble online but in 2023, the government introduced legislation that would ban them. At the moment, the decision to allow these transactions remains with individual banks, credit card providers and businesses.

"Using a credit card for gambling can lead very quickly to a very serious debt trap for consumers and this debt cycle can be extremely difficult to break. Online gambling a fast growing form of gambling so it's imperative that this loophole is finally closed. "

Australian Banking Association

Do you need help?

If you're affected by gambling, you can access free, confidential and 24-hour counselling through the Gambling Help Online chat service or by calling 1800 858 858.

Credit card companies that charge the cash advance rate for gambling transactions

If your credit card allows you to make gambling transactions, the charge will typically be categorised as a cash advance. This is because gambling charges are often "cash equivalents" or "cash substitutes" (ie. where you spend money to get another form of money).

These transactions attract a cash advance fee and a higher cash advance interest rate than everyday purchases. And you'll be charged interest straight away. Here, you can see details for some of the biggest credit card providers:

ProviderGambling transactionsMaximum cash advance rate (varies by card)
American ExpressProhibitedN/A
ANZCash advance rate21.99% p.a.
BankwestCash advance rate21.99% p.a.
Bank of MelbourneCash advance rate
Bank of QueenslandProhibitedN/A
CommBankCash advance rate21.99% p.a.
CitiProhibitedN/A
Great Southern BankProhibitedN/A
HSBCCash advance rate25.99% p.a.
NABCash advance rate21.74% p.a.
St.GeorgeCash advance rate21.99% p.a.
Suncorp BankProhibitedN/A
Virgin MoneyProhibitedN/A
WestpacCash advance rate21.99% p.a.

Using a credit card at gambling establishments

If you're at a gambling establishment, using your credit card for non-gambling activities – such as buying drinks or meals – could also attract the cash advance fee and interest rate.

When this happens, it is because the establishment’s merchant category code is preset to process gambling transactions. So, when the charge goes through to your credit card company, it will most likely be processed as a gambling transaction or cash advance.

If you're planning to use your credit card for a dinner, drinks or anything else at a venue that allows gambling, call your credit card company first and ask them if your spending would be considered a purchase or a cash advance.

Alternatively, get a receipt for your spending and – if you think it is wrongly processed as a cash advance – contact your issuer and explain the transactions were not for gambling.

Tip: If you don't want to use your credit card for gambling, some credit cards let you put a block on these transactions. For example, you can do this through Internet or mobile banking with an eligible card from CommBank, NAB or Westpac.

Buying lotto tickets with a credit card

At the moment, you can use a credit card to buy lotto tickets at most news agencies and other authorised outlets that accept credit card payments.

The Australian Lottery and Newsagents Association (ALNA) has also said buying lotto tickets in-store should be excluded from any regulatory changes around credit cards and gambling. In a submission to the ABA (pdf), it said that lottery products "pose a very low risk and are considered low harm" compared to other forms of gambling.

What to think about before using a credit card for gambling

  • Interest rates. The cash advance interest rates on most credit cards are usually much higher than your regular purchase transaction rates. This rate can reach as high as 25.99% (at the time of writing).
  • Cash advance fees. In addition to the interest charges, you will be charged a cash advance fee, which can be the greater of either a percentage of the transaction amount or a minimum fee. The cash advance fee is typically worth 2–4% of the transaction, which means it would cost you between $10 and $20 for a $500 bet.
  • No interest-free days. Cash advances are not eligible for the standard interest-free period on your card. This means that interest begins accruing immediately when you make a gambling transaction.
  • Rewards. As with cash withdrawals from an ATM, travellers’ cheque purchases and other similar cash equivalent transactions, you will not usually be able to earn credit card rewards points for gambling transactions.
  • Promotional offers. Credit card offers that intermittently reward new customers with bonus points will likely exclude gambling purchases from the list of “eligible transactions” required to take advantage of those deals.

Example: How much could a gambling transaction on my credit card cost?

Say you decide to use your credit card to place a total of $2,000 worth of bets on a sporting event. On a credit card with a 3% cash advance fee and a cash advance rate of 21.99% p.a., here’s what could potentially happen:

  • If you pay the minimum amount each month. If your card balance was $0 before the gambling transaction, and this remains the only transaction on the card, you would pay $5,735 in total over 16 years and 9 months.
  • If you pay the full amount after 30 days. Assuming again that this is the only transaction on your card, you would have to pay $36.15 in interest (21.99% x $2,000 x 30/365), plus $60 for the cash advance fee (3% of $2,000). This is on top of the original $2,000, bringing the total you'll pay off the card to $2,096.15.
  • You pay the total amount later that day. Assuming that this is the only transaction on your card, you would have to pay $1.20 in interest (21.99% x $2,000 x 1/365), plus $60 for the cash advance fee (3% of $2,000) on top of your $2,000 bet. This means it would cost $2,061.20 in total.

Now that you’re aware of the fees that a gambling transaction could incur on your credit card, it may be wise to consider some alternatives. There are fee-free ways to pay for your wagers, such as debit cards or cash. If you’d still rather use a credit card, check out these low cash advance rate cards.

You could also research and explore workaround E-wallet solutions like Skrill and Neteller or PayPal – although PayPal has its own strict rules around gambling transactions. Whatever you decide, always remember to gamble responsibly.

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Amy Bradney-George was the senior writer for credit cards at Finder, and editorial lead for Finder Green. She has over 16 years of editorial experience and has been featured in publications including ABC News, Money Magazine and The Sydney Morning Herald. See full bio

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14 Responses

    Default Gravatar
    AaronDecember 3, 2014

    Is there a credit card that counts transfers to betting agencies as purchases, with an interest free period on purchases.

      AvatarFinder
      ElizabethDecember 4, 2014Finder

      Hi Aaron,

      Thanks for your question.

      As you can see from the page above many card issuers consider purchasing gambling chips or token as cash advances, and many also consider transfers as cash advances as well. I’m unaware of any specific card issuers that would classify this type of transaction as a purchase.

      I hope this has helped.

      Thanks,

      Elizabeth

    Default Gravatar
    ReinerNovember 27, 2013

    Have used Visa Card with foreign Lotto agent, then cancelled transaction /card. St.George did not allow me to answer the merchant (not sending my fax @ a local branch & thus refused to honour the cancellation? Because they claim of the type of merchant – I did not know this or we’re not advised after 6-8 month of transactions? Do I not have the right to cancel my money transaction? My Money after all?

    Why did they have the right not to fax my specially hurried letter over night before the dead line! Then not do the cancellation & still debit my Card A/C -$4500? What happened to customer service?

    I have now paid this money myself because the Bank did not like the Merchant – last payment? Please advise – email soon. Thanks – Reiner

      AvatarFinder
      JacobNovember 27, 2013Finder

      Hi, Reiner.

      Thanks for your question.

      If you have a potential dispute with your card issuer, you can take the issue up with the Financial Ombudsman service. This service is available to people who have a dispute with their financial services provider and is free of charge. But the first step should be to take the issues to the complaints department at St.George. If they are unable to resolve the issue, take it to their customer relations team. The next step after this should be the Financial Ombudsman service.

      I hope this helps.

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