Obtaining a gambling license for an online casino is not as easy as it used to be. Of course, the criteria and requirements will differ depending on which gambling authority the casino seeks a license from.
Some are more stringent than others, but most have similar key requirements that need to be proven and documented.
Since Australian online casinos are operated from abroad, we’ll be looking mainly at the requirements from the most common licensing jurisdictions, which are Malta and Curacao.
Most of the casinos we’ve reviewed and recommended for Australian players at Australian Gambling Online hold licenses from these jurisdictions.
The financial requirements for being eligible to be granted a gambling license can be substantial. For example, to obtain a licence from the Malta Gaming Authority, the minimum capital requirement is €100,000. In addition, the licence application fee is €30.000.
Not only does the company have to have a set amount of funds to obtain a licence, but there are also strict rules for other financial aspects. For example, player deposits have to be kept in a dedicated bank account, which cannot be used for operational costs.
Along with the application, a thorough business plan has to be presented. This should show how the casino is planning on operating, what their player acquisition costs are estimated to be, what the ratio between deposits and withdrawals is estimated to be, what annual turnover they expect, and how they plan on spending any proceeds.
Marketing costs, player acquisition costs, employee costs, and all other expenses. Basically, the company need to show that they have a solid and sustainable business plan to ensure they can offer the services they are promising.
To get a gambling licence, each key employee, usually the C-suite, will have to disclose their finances and undergo a KYC verification. They also have to show that they do not have a criminal record for any financial misconduct.
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One of the strictest requirements is for the safety and security of the casino, its website and its software. The casino needs to be encrypted and show that they adhere to the industry standard in terms of technical security, to protect player data and information.
Furthermore, the casino’s software needs to be tested and audited by an independent third-party company, to ensure it’s fair for players and free of malware.
There’s an extra emphasis on the security of players, their data, and how it’s stored. For example, player information should only be available to the casino’s employees who need access in order to perform their work duties. It’s strictly on a need-to-know basis.
Another aspect of safety and security is responsible gambling. During the last few years, this has become more and more of a focus point for gambling authorities around the world.
The most stringent authorities require that every employee at the online casino has to undergo responsible gambling training.
Furthermore, the casino needs to provide tools such as offering gambling limits, self-exclusion, self-help tests and overall promoting a healthy approach to gambling. This also includes casinos’ marketing efforts.
Ethical business practices are also scrutinised and evaluated when a casino operator applies for a gambling licence. However, it should be noted that how strict a gambling authority is in this regard is the main aspect that differentiates the “safe” vs the “unsafe” gambling licenses.
Among the aspects that will be evaluated before a licence is granted are the operator’s responsible gambling policies, marketing practices, and how they intend to acquire and retain players.
But, this is not something that’s only evaluated before a licence is granted, as it’s also something that’s regularly checked to see that the casino is operating within the regulations set forth by the regulatory authority.
Some examples of what is checked for compliance with the gambling authority’s rules are that the casino is not catering to underage players, that they are not encouraging unhealthy levels of gambling, and that don’t use unethical means to entice players to sign up, deposit money, or play.
Next after the focus on responsible gambling comes responsible marketing, which all ties into preventing gambling harm, which is the number one priority for any responsible and reputable gambling authority.
As mentioned, the gambling licences that are used the most by online casinos that cater to Australian players are those from Malta and Curacao. But also the licences of other authorities like Kahnawake Gaming Commission and Antigua and Barbuda can be found.
Each of these offers its own levels of player protection and its own set of requirements from operators.
The most reputable gambling licence is the one from the Malta Gaming Authority. This is the strictest one, and therefore the safest one. Next after that comes the four master licences from Curacao, with the three common ones being Antillephone N.V. Curacao eGaming and Gaming Curacao.
The Curacao licences have gained a more favourable reputation lately, as they are no longer as slack as they used to be.
Gambling licences issued by Kahnawake Gaming Commission, Antigua and Barbuda, Panama and some other more obscure licences are best to avoid. These are known for offering simple pay-to-play services, which means there isn’t much oversight happening.
An operator can more or less just buy a licence, and there are no real requirements that have to be met to keep it.
Online casinos offering their services in the Australian market have many gambling licences to choose from. The most reputable ones are offering a high level of security, due to the stringent rules required by the gambling authorities.
In order to obtain a licence, the casinos have to offer more or less full disclosure of their finances and abide by financial terms set forth by the regulators. They also need to offer a high level of security to ensure the safety of player information and data.
Responsible gambling policies and marketing materials are also scrutinised, and this all ties into the ethical business practices that are required.
Not only does a casino operator have to show and detail all of this in order to get approved for a licence, but they also have to continually show that they maintain high standards after operations have begun.
Gambling authorities can at any time show up for a scheduled or unscheduled audit, and then they look into all aspects of the casino’s operations.
All of this is done in order to ensure that you as a player are protected. It’s done to protect your funds, ensure the games the casinos offer are fair, and make sure that the casino is not laundering money or engaging in any illegal or unethical business practices.
Therefore, as long as you play at an online casino with a reputable gambling licence, you can rest assured that the casino can be trusted.
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