What is Cashback?
Cashback is a promotion that refunds a percentage of a player's net losses over a set period, paid either as cash or as bonus funds.
A 10% weekly cashback scheme returns £10 to a player who lost a net £100 that week. Some schemes pay real money without wagering, others credit bonus funds with requirements. Cashback is sometimes tiered by VIP level, with higher percentages for bigger spenders.
Because cashback reduces the effective house edge for the recipient, it is often targeted at high-value customers. Regulators have questioned loss-based incentives because they can encourage continued play after losses.
In industry reporting, cashback costs are part of bonus spend that is deducted when calculating net gaming revenue. Terms usually define how net losses are measured, for example whether bonus funds are included, and set a minimum loss before cashback applies. Some schemes cap the amount returned per period. Because cashback is calculated on losses, it pays out more to customers who lose more, which is the basis of regulatory criticism.