DraftKings Bans Credit Cards. Will Others Follow?

On August 25, DraftKings officially stopped accepting credit card deposits for its U.S. sportsbook and casino customers. For years, credit cards have been a way for some players to fund their accounts, but they’ve also raised red flags around consumer protection, problem gambling and regulatory compliance.

The decision is framed as a move to help customers avoid steep “cash advance” fees and high interest rates. But the timing is interesting: just weeks earlier, the Massachusetts Gaming Commission fined DraftKings $450,000 for allowing credit card deposits, in violation of state law.

This decision impacts DraftKings’ millions of customers and could also reshape the U.S. sports betting industry. With some other operators already limiting credit card use, and several states enacting outright bans, the question now is whether the rest of operators will follow suit.

Why did DraftKings ban credit card account funding?

The official line from DraftKings is that the ban is designed to improve the user experience by sparing customers from cash advance fees and high interest rates. As some industry analysts noted, many players are automatically charged the cash-advance rate when they fund accounts with credit cards, which can quickly become financially burdensome.

Behind the scenes, however, regulatory and business factors appear to have potentially also been influential. In July, DraftKings self-reported multiple credit card violations in Massachusetts, ultimately leading to the six-figure fine, which is the largest the state had issued to an operator since sports betting became legal. Investigators found that DraftKings accepted more than $83,000 in improper credit card deposits, despite state law banning the practice.

There are also financial considerations. Chargeback fees on disputed credit card transactions can cost operators $20 to $100 each, not including penalties or higher processing fees. By removing credit cards altogether, DraftKings reduces both regulatory and financial risk.

In short, while the decision is customer-friendly, it also aligns with self-protection after costly missteps.

Which states allow betting with credit cards? Which banned it?

Some states allow credit card deposits, while others have outlawed them for a variety of reasons.

The following states currently prohibit credit card deposits for online sports betting:

• Tennessee – Prohibited from the start of online betting.
  
  

• Iowa – Explicit ban under state law.
  
  

• New Hampshire – Prohibits credit card use for betting accounts.
  
  

• Oregon – Closed the door on credit card funding.
  
  

• Rhode Island – Banned deposits via credit card.
  
  

• Vermont – As a new market, excluded credit cards from day one.
  
  

• Massachusetts – Longstanding prohibition on credit card gambling.
  
  

• Illinois – Recently banned credit cards for all gaming, including casinos and video gaming.

That makes at least eight states with bans in place. Together with banks like Bank of America, which decline gambling-related transactions, the options for betting with credit cards are narrowing. Still, in most jurisdictions with legalized sports betting, credit cards like Visa, Mastercard and American Express remain available funding sources.

Will other sportsbooks and gambling operators ban credit cards?

DraftKings is one of the biggest, but they are not alone. Fanatics Betting & Gaming, Betr and Sporttrade already exclude credit cards. That means four major players in the U.S. gaming industry now prohibit them.

Others, like FanDuel, BetMGM and Caesars, still accept credit cards in states where it’s legal. DraftKings’ move could put pressure on them to reevaluate. DraftKings’ sheer market share means competitors and regulators alike will pay close attention.

There’s also a political dimension, including a credit card ban in legislation could help attract votes when attempting to pass legalized gambling in a state. Even if the findings from research on harm reduction is mixed (as we will touch on in the next section), banning credit cards has become a politically palatable way to show commitment to combatting gambling harms.

All signs point toward a broader industry shift, whether through voluntary policies or regulatory mandates.

Does banning credit cards reduce at-risk behaviors? 

The logic behind banning credit cards is clear: they allow gamblers to bet with borrowed money, amplifying risks of debt and financial harm. But whether bans actually curb problem gambling is another matter.

Evidence from Great Britain’s national ban suggests that while the move was largely seen as positive by consumers and treatment providers, researchers found that many high-risk gamblers did not meaningfully change their behavior. Instead, some shifted to alternative borrowing methods, like payday loans.

Similarly, people with no or low levels of at-risk gambling behaviors were more likely to reduce their use of credit cards than those at higher risk. In other words, bans may prevent casual bettors from sliding into debt but do less to help those already struggling.

This raises important questions about whether such policies are an effective harm-reduction tool, or whether they simply add friction without tackling underlying problems.

Gambling Addiction support in the U.S.

While the industry debates payment policies, one reality remains: gambling addiction is a real, serious disorder that requires professional care. Restricting credit card deposits may limit some risks, but it does not address the deeper patterns of compulsive gambling.

If you or someone you care about is struggling with gambling, sports betting, or related financial distress, help is available. Birches Health offers expert, confidential virtual care tailored to individuals facing gambling addiction, sports betting problems, or compulsive day trading. Birches’ licensed clinicians specialize in helping clients regain control, repair relationships, and restore financial stability.

Take the first step toward recovery with Birches Health today:

• Call 833-483-3838
  
  

• Book a clinical assessment with a specialist
  
  

• Email help@bircheshealth.com