FanDuel bans credit card-funded bets, following DraftKings

Core Viewpoint - FanDuel will stop accepting credit card deposits for sports betting in the U.S. effective March 2, following a similar decision by DraftKings, aimed at improving the deposit experience for customers [1][2]. Company Actions - FanDuel's decision to remove credit cards as a payment option has been in consideration for several months, and it is part of a broader evaluation of payment methods offered to customers [2]. - The company stated that the change is intended to enhance the deposit experience for users [2]. Industry Context - The sports betting industry is under scrutiny, with Senator Elizabeth Warren advocating for a ban on credit card usage in sports betting, highlighting the high costs associated with credit card transactions [4][5]. - FanDuel and DraftKings together account for over 70% of the online sports betting market in the U.S., indicating that this policy change could significantly impact the industry [2][5]. Financial Implications - Bets placed with credit cards incur higher costs due to fees classified as cash advances, which can be $10 or 3-5% of the amount advanced, whichever is greater [3]. - Several states, including Massachusetts, Iowa, Tennessee, Rhode Island, Oregon, and Vermont, already prohibit the use of credit cards for online sports betting [3].