Gambling resorts are known for extending credit to their most valuable customers. Due to the potential for financial harm, most Canadian provinces forbid the practice. However, there are four resort-style casinos in Ontario that continue to provide them.
Those four Ontario casinos are Caesars Windsor, Casino Niagara, Casino Rama, and Fallsview Casino. Each offer a program that provides casino credit loans to eligible customers. These loans are not as easy to get approved for as they once were, thanks to more than $10 million in defaulted loans between 2010-2017. But for eligible customers (high rollers) who don’t want to carry around a lot of cash, they can be extremely convenient.
On this page we cover all the relevant topics – how to apply for casino credit; why you should or shouldn’t gamble on credit; and 10 million reasons Ontario should probably ban the practice (like every other Canadian province).
The concept is simple. Casino loans are provided on a short-term basis of 30 days, with no-interest accrued. Background checks are facilitated on all applications prior to approval. It’s the exact same procedures you’d expect to follow for a bank loan, car loan, pay-day loan, etc.
The first thing you may have already noticed about Ontario casinos is that they don’t actively promote house credit to customers. There’s no flashing sign above the cashier; no stack of credit applications at the player services desk. You’re going to have to come right out and ask. And because it’s not advertise, if you don’t look the part of a high roller, you’ll probably be dismissed with an abrupt, “No.”
If you make the aesthetic grade or are a well-known member of the casino, you just may get your foot in the door. At this point, you can expect to be invited in back to sit down and begin the application process. Don’t be surprised if you’re asked to provide a counter-cheque right off the bat. This is essentially a post-dated cheque that the casino can cash 30 days after credit is extended, if the gambler hasn’t paid off the debt by then. Beyond that, there’s the credit application process.
Here’s what you can expect to happen. This information is taken from Part 6(b) of the Privacy Policy of the Fallsview Casino website.:
“To assess your eligibility for credit and determine a line of credit that corresponds with your financial means, we will first have to obtain information about you and verify your financial history. You will be required to provide us with your name, address, income, banking information and credit history. To determine your eligibility for credit, we may disclose your personal information to credit reporting agencies, financial institutions and other casinos (which may be located outside of Canada). The information on our credit application is required under regulations made under provincial gaming laws and is similar to the type of information a bank would require before extending a consumer loan.”
While specific qualifications are not provided (they never are), it’s safe to assume your financial history and credit worthiness must be of superior standard. Casinos are in the business of making money. They are not going to extend you credit just so that you can (probably) lose their money, and not be able to pay it back.
Which brings us to…
Ontario’s major casinos were dealt a scathing blow a few years back that should have made them rethink loans for casino credits. News broke in 2017 after more than $10 million in loans defaulted over the previous seven years.
Between 2010 and 2017, the Ontario Lottery and Gaming Corp (OLG) reported that 605 gamblers who took advantage of house credit had defaulted on their loans. Collectively, the OLG says those unpaid loans came to $10.4 million. That equates to an average of $17,000 in debt per defaulted gambler during the 7-year span.
Most of us wouldn’t expect to get away with that. The phone calls would never stop. Soon enough, the creditors would come knocking. Our credit score would plummet into the abyss, and even then the harassment to repay that debt would continue incessantly. But apparently that wasn’t the case for these casino patrons.
OLG documents confirm that, after “exhausting all lawful collection options, including the services of collection agencies,” those debts were simply absorbed. The $10.4 million was officially deemed “uncollectible”.
The OLG said that yes, all 605 gamblers whose debts defaulted from 2010-2017 provided countercheques. However, when the casinos tried to collect on them 30 days later, there was no money in those accounts.
It’s worth noting that OLG is not directly responsible for any Ontario casino that offer casino credit loans. OLG provides oversight, as is mandatory of all gambling properties in the province. But these operations are all under the management of independent casino corporations; the Las Vegas big-wigs, so to speak. OLG does not offer credit at any of its provincially-owned casinos.
Oddly enough, we find that…
Despite the absorption of over $10 million in debts by Ontario casinos, the OLG still considers casino credit a worthwhile program. In 2017, when the default debacle became headline news, the agency defended the practice, saying that only 0.25% (1 in every 400) of casino patrons actually use them.
OLG explained that casino credit loans aren’t available to everyone. In the 2015-16 fiscal year, of the 171 gamblers who applied for house credit, 59 were denied. Reasons for approval versus denial were not provided, but OLG’s then-VP of Gaming, John MacFarlane, shed some light on the corporation’s stance.
“We view it as tool of convenience. We don’t want people coming in with pockets full of money.” MacFarlane explained it as a matter of “customer safety and security,” more than anything else. “It’s really primarily there for folks who, first off, demonstrate the wherewithal they can afford credit. There is a significant vetting process before granting credit.”
Many casinos outside Ontario, both within Canada and internationally, frown upon the controversial practice of granting casino credit loans. While it can be a boon for casino operators, it’s also risky business.
As much as we like to think that casinos are in the business of gambling, the house edge always guarantees them a profit. It’s no gamble for them. With casino credit loans, though, there’s always the risk of defaulting. That can hurt the casino’s bottom line, especially in cases like this, where millions of dollars are involved.
There’s also an assumed link between casino credit loans and the proliferation of problem gambling. Lisa Pont, a social worker with the Problem Gambling Institute of Ontario, was especially concerned over sop many unpaid loans being squashed.
“If those debts do not get addressed and there is no plan to pay them back, it can often keep people in the gambling cycle chasing their losses.”
Which bring us to our final question…
If you’ve read and understand all of the above information, you should be able to answer this question with some degree of confidence. Only you know if you’re both financially stable and responsible enough. If you’re still unsure, I would recommend a pass. Even so, here are some questions you can ask yourself to help you decide.
If you’ve answered these questions honestly and feel it’s appropriate to apply for casino credit loans, by all means go for it. In most cases, however, we would recommended against it. We talk about this more in-depth here:
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