Key Moments:
- FanDuel stopped accepting credit card deposits on March 2
- Earlier, DraftKings introduced the same restriction in August
- Meanwhile, U.S. Senator Elizabeth Warren raised concerns about high credit card fees in sports betting
FanDuel Implements New Deposit Restrictions
FanDuel Sportsbook officially stopped accepting credit card deposits for its U.S. sportsbook, casino, and racing products on March 2. As a result, customers must now use alternative payment methods. Notably, this decision follows a similar move by DraftKings, which introduced the same restriction last August.
Rationale Behind the Change
According to FanDuel, the company recently reviewed the payment methods it offers customers. After that review, it chose to remove credit cards as a deposit option for its U.S. sportsbook, casino, and racing products. The company stated that this change aims to improve the overall deposit experience for users. In other words, FanDuel believes the new policy will create a smoother and more transparent process.
Focus on Fees and Interest Rates
The new restrictions directly address concerns about high fees and interest charges linked to credit card gambling deposits. For example, many sports bettors face immediate interest charges and additional transaction fees when they fund accounts with credit cards. Consequently, even small deposits can become costly.
In response, Senator Elizabeth Warren, Ranking Member of the Senate Banking, Housing, and Urban Affairs Committee, welcomed the change. She stated that FanDuel’s announcement prevents credit card companies from charging what she described as “junk fees” in much of the sports betting market. Furthermore, she noted that these fees can cost up to $10 to fund a $20 bet. Therefore, she urged the rest of the industry to adopt similar policies.
Industry and Legislative Scrutiny
Shortly before Super Bowl LX, Senator Warren sent a letter to major sports betting companies. In that letter, she requested details about what she called “abusive credit card betting fees.” Specifically, she explained that credit card transactions for gambling often count as cash advances. As a result, users typically pay a one-time fee, often the greater of $10 or 3–5% of the transaction amount. In addition, interest usually begins accruing immediately.
She emphasized that a customer who places a $20 bet with a credit card could face a $10 fee on that single transaction. While many Americans accept the risk of losing a bet, she argued that most do not expect to lose an extra 50% in fees on top of their wager.
Request for Transparency
In her letter, Senator Warren also urged betting companies to provide detailed data about credit card usage on their platforms. Moreover, she argued that many users do not fully understand the associated costs and fees. Because of this lack of awareness, some customers may face unexpected financial strain. She added that many users do not realize credit card deposits often qualify as cash advances, which trigger additional fees and immediate interest.
Timeline of Policy Changes
| Company | Action | Effective Date |
|---|---|---|
| DraftKings | Discontinued credit card deposits | August |
| FanDuel | Discontinued credit card deposits | March 2 |
- Author
Daniel Williams
