Malta reduces its payout rate.
Malta plans to decrease the payout percentage in the digital gambling sector from 92% to 85%, as announced by the Maltese Gaming Authority (MGA) in an official pronouncement. This decision was made after a lengthy calculation and testing process that received widespread support within the industry. The MGA aims to align the online gambling market with land-based gaming offers through this adjustment.
Fostering Flexibility in the Industry?
Malta's growing significance in the gambling industry is no secret. Numerous businesses involved in this sector have established themselves on the island in the Mediterranean. One of Europe's most serious and well-established regulatory bodies is the MGA, which is responsible for issuing licenses in the European Union. Besides regulating and testing, the MGA also strives to safeguard minors and vulnerable players and promote responsible gambling in a controlled setting.
The MGA has long been at the forefront of changes in the gambling industry, including redefining the payout percentage in the online gambling sector. The previous standard of 92% was deemed inadequate due to the widening chasm between offline and online gambling markets.
The Malta Gaming Authority has played a prominent role in fostering a more regulated European gambling market. This agency is credited with issuing Maltese gaming licenses and ensuring compliance with quality standards across the continent. It is also known for promoting play safety, preventing underage and vulnerable individuals from participating in the industry.
According to a press release issued on their website, the MGA conducted a cross-industry poll to gauge the opinions of various stakeholders, including experts, gaming firms, and even players, on the current payout rate. However, they did not disclose specific names of those who participated in the survey. Nevertheless, the results suggested that the majority of respondents favored a decrease in the payout percentage.
The MGA clarifies that this adjustment won't lead to any losses in profits. Instead, the new rate will provide more flexibility for gaming operators and online casinos to adjust their payout rates, primarily in response to market trends and competitive pressure.
Financial Consequences
While the MGA cited the need to align the offline and online gaming sectors as the primary reason for the rate reduction, other factors also contribute to this decision. Rising operational costs are a significant factor in redefining the payout rate. The MGA's announcement cited the increasing tax burden and compliance costs in various markets, further pressing the need for this adjustment.
Across Europe, governments are embracing the liberalisation of online gambling to accommodate modern market conditions. This process has seen a surge in legalisation efforts, with new regulations geared towards creating a structured online gaming environment. Countries like Germany are preparing for a new legal framework from July 1, 2021, enabling licensed online casinos to operate within their borders. With these developments, companies operating in this sector face the challenge of adapting to the requirements of the market and bearing the consequent regulatory and compliance costs.
Disapproval from Some Providers
Not all market participants support this change, despite the majority of those surveyed by the MGA endorsing the decrease in the payout rate. Several providers have voiced concerns over lowering the rate too much, arguing that this could drive players away from regulated gambling platforms and encourage them to join black market operators offering higher payouts. This shift could have detrimental effects on the industry as a whole.
No set implementation date has been announced by the MGA. Most companies anticipate that the transition to the new payout rate will take several weeks to complete.
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Source: www.onlinecasinosdeutschland.com
