FanDuel Joins DraftKings in Ditching Credit Card Deposits

FanDuel will no longer allow users to deposit money into their sportsbook accounts using credit cards starting early next month, following a similar decision by DraftKings over the summer, which came after it faced a $450,000 fine from the Massachusetts Gaming Commission.

Starting March 2, credit card deposits will not be accepted on FanDuel, according to a message that displays on the app when users go to deposit funds. 

The change comes a few days after Sen. Elizabeth Warren (D., Mass.) sent a series of nearly identical letters to a group of sports betting operators—including FanDuel and DraftKings—requesting information about “abusive credit card betting fees that rip off Americans using sport-betting platforms.”

In a statement Wednesday, Warren said, “FanDuel’s announcement means credit card companies will no longer be allowed to scam Americans with junk fees in the majority of the sports betting market.”

“The rest of the industry should follow suit,” she added. 

According to FanDuel, the timing is a coincidence.

“Over the last few months, FanDuel has been evaluating the payment methods that we offer to customers and made the decision to remove credit cards as an option for our sportsbook, casino and racing product in the United States,” a FanDuel spokesperson told Front Office Sports. “This change was made to improve the deposit experience for our customers.”

Warren’s letters point to the fact that when credit cards are used to fund wagers on sports betting platforms, it is “almost always” treated as a “cash advance”; such transactions include high fees and interest rates charged to users by the credit card companies. Interest can “start accruing immediately, rather than only after the cardholder carries a balance past their due date,” the letter says, and each cash advance can carry fees as high as $10 or 3% to 5% of the amount advanced (as an example, she notes that a customer who uses their credit card to fund their account for a $20 bet would pay a $10 fee on that single transaction).

“Many users are unaware of the costs and fees associated with this type of credit card use, which can push them into financial trouble when gambling,” Warren said in a statement accompanying the letter. “Specifically, users are reporting that they did not realize that using their credit card to place a bet on a sports gambling website would be treated as a cash advance and accrue additional fees and interest.”

In addition to DraftKings and FanDuel, Warren issued letters seeking information about policies related to credit cards being used for sports betting to Fanatics, BetMGM, Wynn Resorts Holdings, Underdog Sports, Caesars Holdings, Bet365, and Hard Rock.

Following DraftKings

Not all of those companies offer traditional online sports betting, and some—Fanatics, for instance—do not allow users to deposit funds using credit cards. As another example, Underdog’s business is focused on daily fantasy sports and prediction markets; although it used to offer traditional sports betting in North Carolina, it shut down that operation in December, not long after dropping plans to obtain a license to offer sports betting in Missouri.

Still, the issue raised by Warren is notable because only eight states ban the use of credit cards in sports betting: Iowa, Massachusetts, New Hampshire, Oregon, Rhode Island, Tennessee, Vermont, and Illinois.

Massachusetts is where DraftKings ran into an issue. When Massachusetts legalized sports betting in 2022, the law did not allow operators to accept deposits or bets using credit cards. DraftKings was fined $450,000 in August after it self-reported three violations of the statute across 2023 and 2024 that resulted in the company accepting more than $83,000 in funds from credit cards. The company blamed the issue on “internal miscommunication.”

Following that fine, DraftKings said last year it would no longer offer the option, even in states where it’s legal to use credit cards for sports betting.

It’s certainly important to ensure consumers are not charged unfairly high fees if using credit cards to bet on sports, although a gambling industry source tells FOS that credit cards “make up a very small percentage of deposits across sportsbooks”—so from the perspective of sports betting operators, “there’s no business reason” to keep allowing users to deposit money using credit cards.

The decision to ditch credit cards is not expected to impact the bottom line for DraftKings and FanDuel, according to Barry Jonas, senior gaming analyst at Truist Securities. 

“You never want to increase the roadblocks or friction to get money out there, but this doesn’t seem like a difficult decision to make with regard to responsible gaming issues,” he tells FOS. “Credit cards are the most expensive forms of payment for both the consumer and operator.”