Illinois Moves to Stop Gamblers From Using Credit Cards to Fund Sports Betting Accounts

The Illinois Gaming Board is proposing to prohibit gamblers in the state from funding sports wagering accounts with credit cards. The proposed rule is intended to “support responsible gambling,” according to a press release issued by the board.

Credit cards can be an essential part of your financial toolkit. Credit card issuers offer a payment instrument that allows consumers and businesses to make purchases today and pay for them later. 

That means that credit cards can be an invaluable tool to buy essential things like medicine or food when you don’t have enough cash on hand — or in your bank account — to cover the cost of the purchase.

But, from a psychological perspective, credit cards may also remove some of the mental guardrails that prevent cardholders from making impulse purchases. 

Using your credit card to complete a purchase can feel more like scanning your driver’s license to gain entry to an event than transferring money. After all, physical currency isn’t moving from your wallet to a seller’s hands during a credit card transaction.

In the release, Marcus D. Fruchter, Administrator of the Illinois Gaming Board, said the board conducted a review and determined that prohibiting a consumer’s ability to fund a sports betting account with their credit card “is a justified and impactful advancement in Illinois sports wagering.”

The Illinois Gaming Board believes the proposed rule will lead to increased responsibility in gambling.

“There is a growing body of recent research showing that restrictions on credit usage to fund wagering accounts encourages responsible gambling and mitigates the harms of compulsive gambling,” Fruchter said. “Problem gamblers are particularly at risk and studies have shown an often-problematic willingness for compulsive gamblers to use credit cards to place bets.”

Legal wagering on sports started in Illinois in 2020. At that time, 13 other states allowed sports gambling, and none of them disallowed gamblers from using their credit cards to fund bets, according to a report in the Chicago Tribune.

In 2025, gambling on sports is legal in almost 40 states, and the majority of those states allow sports bettors to fund gambling accounts with credit cards.

Decisions such as this one by the Illinois Gaming Board can make it difficult for credit card issuers to estimate future earnings. Illinois is only one state, but it ranks sixth among all states in population in 2024.

Credit card issuers would likely be staring at bleaker card revenue projection figures should other states follow Illinois in prohibiting using credit cards for legal sports betting in 2025. 

A December 2024 study from the Consumer Financial Protection Bureau (CFPB) revealed that some credit card issuers “charged $10 or more in ‘cash advance’ fees and added interest for each sports gambling transaction made with a credit card.”

Issuers likely employed that strategy to gain compensation for the risk of allowing gamblers to make bets with their credit cards. 

But the CFPB said that, “disclosures made by credit card issuers about cash advance fees for online betting are not always clear or consistent.” That statement suggests that regulators may have more rules in store for a credit card issuer that allows its customers to gamble on sports with funds from their credit card. 

The legalized gambling market is a relatively new one in the grand scheme of things. Supreme Court action in May 2018 paved the way for legal sports betting. For context, that was more than a full year before the world first heard of COVID-19, and much has changed since that time in the economy and credit card landscape.

Credit card issuers can learn an important lesson from the Illinois Gaming Board’s decision on funding sports bets with credit cards. Namely, issuers shouldn’t rely too heavily on future revenues from fairly new industries. As those industries mature, regulators and other stakeholders may introduce new rules that put a damper on once rosy prospects.