JPMorgan Chase & Co takes initiative to approve online pari-mutuel credit card wagering

America’s horseracing industry predicted a banner year ahead following the green light shown by the nation’s leading financial institution on online betting with its credit cards.

The National Thoroughbred Racing Association (NTRA) On Tuesday, promulgated that  JPMorgan Chase & Co had initiated the approval of credit card transactions with US-licensed advance deposit wagering (ADW) sites, or online race betting.

With JPMorgan Chase & Co,  being the nation’s largest credit card issuer, having over 80m active credit cardholder accounts across the country, the initiative to approve transactions stamped with the ADW industry’s 7802 merchant category code could bring on board other major card issuers approving similar measures, which would vitally boost up the online pari-mutuel betting handle.

The NTRA CEO, Alex Waldrop hailed Tuesday’s announcement as “a major victory for our industry” and singled out the lobbying efforts of Rep. Andy Barr (R-KY), who serves as Co-Chairman of the Congressional Horse Caucus and (more importantly) serves on the House of Representatives’ Financial Services Committee.

While ADW operators like the Stronach Group’s XPressbet, Betfair’s TVG and Churchill Downs Inc’s TwinSpires will welcome Tuesday’s announcement, the news is yet another example of the exceptionalism the pari-mutuel industry enjoys when it comes to interstate online gambling in the US.

Some banks like JPMorgan Chase began blocking transactions with ADW sites in the wake of the 2006 passage of the Unlawful Internet Gambling Enforcement Act (UIGEA), which prohibited financial institutions from processing payments on behalf of online gambling comments.

Racing lobbyists ensured that the pari-mutuel industry got a carveout from the UIGEA but the legislation was broad enough that many financial institutions chose to block ADW sites out of an abundance of caution.

This is the second major boost the US pari-mutuel betting industry has received in the past six months. Last September, the US Treasury Department and the Internal Revenue Service approved new rules on how punters’ winnings are taxed, which the NTRA’s Waldrop called “among the most meaningful regulatory advances made by our industry in decades.”