Online casinos, sites that hosted actual real-money games of chance, popped up in the mid-1990s, with Antigua and Barbuda being the first place that allowed companies to offer them. Following this island nation’s passing of laws that permitted this kind of online entertainment, other regions like Curacao, Alderney, Panama, the Isle of Man, Malta, and others followed.
However, legal UK online casinos did not become a thing until 2005, when the United Kingdom passed its Gambling Act, which is a law that created the UK Gambling Commission.
Before the Gambling Act came into force in the second half of 2007, no one was allowed to provide interactive gaming services to UK residents.
From that point on, the UK online gambling sector developed at an impressive pace, and as this sphere expanded, so did concerns about how the wide availability of betting pastimes would and has affected the public. This brought about KYC verification at UK-based casinos.
This meant that all site users must supply official ID documentation to operators, an obligatory requirement per the UKGC’s License Conditions and Codes of Practice from May 2019.
Below, we look into how SMS verification was used by UK casino platforms even before this and why it is important.
The History of SMS Verification
Despite most people connecting this security method with smartphones, the reality is that the underlying technology that enables it has been around since the 1980s. It was developed in the GSM mobile standard era, even though the first SMS message was sent at the start of the 1990s.
Technically, the concept of one-time passwords can be dated back to the early 20th century, and cryptographic pads used in cryptography. But digital OTP systems showed up in the 1980s, and commercial token generation emerged in the 1990s.
Page or phone authentication got patented by Ericsson (1994), with Nokia getting a similar patent a little later on, but one that more resembles modern web-type authentication.
Banks started adopting this method in the 2000s, as regulators demanded more security. In the 2010s, SMS 2FA was quite common everywhere, including gambling websites.
How UK Casinos Use SMS Verification
Phone numbers are now seen as what many refer to as a soft proxy for identity verification. Casinos send codes to users’ numbers, and by entering those ciphers, they prove they are who they claim to be on the gaming website. While not perfect, this is regarded as reasonable evidence for identification.
Many UK gaming sites now ask that customers enter a phone number during the registration process, with this requirement serving to minimize bot accounts.
The entered number can be used by operators to compare with those in the national self-exclusion register, GamStop, to see if new players have a self-imposed gambling ban active or not.
That said, the main use of SMS verification at online casinos in the UK is two-factor authentication, helping players boost security. When a site spots someone signing in from an unrecognizable device or location, it sends an SMS to the registered number to get confirmation that the real customer is accessing his account. This protects against credential-stuffing attacks.
Some payment methods also require that casino transactions get verified by SMS codes, and UKGC rules state that mobile number verification can get used for enabling SMS-based marketing opt-ins.
Is SMS Verification a Necessity?
For many, going through extra steps to access a gambling platform is a hassle they would rather avoid. Ideally, there would be a verification method that would automatically and effectively verify user identity in the background.
Still, we are not there yet, and SMS can arrive with delays, making players miss the input window, and they may not arrive at all if there are network issues.
In general, business studies point out that any additional steps during registration bring about drop-off rates, but still, when safety is in question, it is better to sacrifice some time to ensure that everything is secure.
Now, while the UKGC does not specifically prescribe SMS verification, most operators demand it in some form, and a mobile number is very effective for GamStop verification.
Without this tool, bonus abuse rates, multi-accounting, payment fraud, and all kinds of other problems will increase, so it is safe to say that for now, SMS verification is a necessity.
