How Online Gambling Works in Canada
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How Online Gambling Works in Canada

How Online Gambling Works in Canada

Did you know that Canada is home to a lot of different forms of gambling? Sure, they may come across as quiet and polite neighbors not wanting to rock the boat but once you cross over the 49th Parallel, it doesn’t take long to see that gambling keeps the country rocking. Feel like some casino action? 

Well, in the Great White North you have the option of visiting one of close to 100 different land-based casinos and over 38,000 VLTs. If you like to participate in some sports betting activity, you can place your bets at one of the countless lottery retailers located in everything from shopping mall kiosks to grocery stores, gas stations, and pharmacy counters. Then there’s Bingo. 

Oh, and we can’t forget charity gambling where non-profits get into the action as fundraisers and there are even provincially-operated online gambling sites where sports betting and casino gaming are all in season. However, in Canada, the laws that govern such activity are straightforward with generous sprinklings of grey areas that have yet to be defined. Let’s take a much closer look at how do online casinos work in Canada along with all the other gaming activity taking place just north of us.

 

History of Gambling In Canada

Gambling in Canada was first outlawed in 1892. At the time, the Criminal Code of Canada put a stop to all forms of gaming under a section titled, “Offences against religion, morals, and public conveniences.” By 1969, the Criminal Code underwent a slight adaptation that permitted lotteries to be held provided they were used to raise funds for worthwhile causes. That opened the doors to the introduction of sports lotteries in 1976 and 1985, the federal government decided to turn control over to each province to govern their gambling activities. 

This included lotteries, lottery schemes as well as computers, video devices, slot machines, and wagering on horse races over the telephone. The gaming commissions in each province take care of all of these matters in their province of jurisdiction. For example, in British Columbia, it’s the BCLC (British Columbia Lottery Corporation), founded in 1985. In Manitoba, it’s the Manitoba Liquor & Lotteries Corporation, created in 2013, and in Quebec, it’s Loto-Quebec which was founded in 1969 to name just a few. These are all crown corporations that license and oversee all gaming.

 

Casino History In Canada

Have you heard of Diamond Tooth Gertie’s? That was the first gambling venue to surface in Canada. It was back in 1971 and was located in the tundra of the Yukon Territory but it wasn’t until after 1985 and provincial control replaced federal control when casinos started to pop up almost everywhere. The first of the government-owned casinos opened in 1991 and was the Crystal Casino in Winnipeg, Manitoba. The casino itself was not a standalone operation as it filled the seventh floor of the Fort Garry Hotel. It eventually closed in 1999 but blazed a trail that opened the door for several other casinos to be built and opened elsewhere in Manitoba. 

Now the grey area. Online gambling. In Canada, online gambling is legal provided the licensed operator is located within Canada. This goes for both sports gambling and casino games online. However, offshore online sportsbooks and casinos have been welcoming Canadian players for several years and the Criminal Code hasn’t quite defined that part. Where it says it is illegal to operate an online casino in Canada without a license, it says nothing about whether or not Canadians can access non-licensed gaming services. So, to many, that means offshore sportsbooks and casinos are fair game. Until someone gets prosecuted.

 

Online Casinos In Canada

You already know how gambling works in Canada in that if the site is not licensed, it isn’t a legal site to visit. With each province in the country controlling licensing, it only makes sense that there would be provincially run gambling portals. While they do have a fair deal of activity, the gaming options found at any of these sites are still far less attractive or thrilling than one can find at an offshore site. You would think that to lure some of the Canadian loonies spilling overseas that provincial lottery corporations would be establishing sites with competitive gaming and features to pull away those crazy Canucks. 

Sadly, the sites controlled by provincial governments are not all that exciting at all. Because of the unique way in which the Canadian government gave control to the provinces, each provincial gaming commission has to operate its virtual online service. The choices at these services are restricted to mostly just casino gaming, instant lottery games, and sports betting. Although some provinces have chosen to do some upgrading, online gambling in Canada is far more interesting when an offshore gaming site is part of the equation.

 

No Straight Bets And Geo-Fencing

Where Canadian provincial online gaming sites are missing out is the types of betting they will or will not allow. When the Criminal Code of Canada was updated in 1976, sports lotteries were born however, the betting activity in sports wagering has always been restricted to parlays. Straight bets are a no-no and this is one reason why many bettors in Canada will surf the web to find an offshore sportsbook to place straight bets. There is one sports betting option that is available across the country. 

It goes by different names such as Sport Select, depending on the province you are playing in. Typically, Sport Select is operated in conjunction with a local lottery retailer so, in essence, you could go to your local pub or corner convenience store and place your sports bets. Some provinces have created a mobile portal which means not only does it fall under the online sports gambling legislation, but gambling as well. This has limited the appeal of this form of sports betting. Plus, as each province controls its gaming activities, there is geofencing to contend with. Cross into another province and connectivity is lost while gaming on the move.

 

Know Your Customer (KYC)

Considering that online gambling is largely anonymous, systems have been implemented in Canada to try to protect both players and casinos. The process is known as KYC, or Know Your Customer. Essentially, it is the registration part of joining any online casino. The information you are requested to provide is intended to prevent underage gamblers from joining. But it does a lot more than that. KYC is used to combat fraud, money laundering, corruption, and bribery. The process does this by gathering personal information to verify that you are who you claim to be although you can gamble under a user name that does not reveal any of your personal information to other gamblers. 

You will be asked to provide the standard identity information such as your full name, address, date of birth, address, and phone number. You will also have to verify your age and identity by sending a photo or scan of a piece of photo ID. Typically a driver’s license or passport will suffice. Then you will be expected to verify your address by providing a copy of a utility bill or bank statement with your address on it. These documents should be no older than three months. Some other casinos will have a further set of questions to verify your financial situation. Documents usually requested for this may include scans or photos of the bank card you plan to use at the casino, savings account information, details on your pension, a bank statement, payslip, or other related paperwork.

 

How Gambling Works Online in Canada - Payment Information

Once you get through the process that verifies that you are who you are, the next step involves setting up your payment method. This is a requirement if you are joining an online casino to play with - and hopefully win - real money. As a result, these online casinos provide a variety of payment options to meet the needs of new players. This is going to include fees. While players won’t be paying fees directly, you can expect to see a fee noted in the fine print as you register to play. The fees online casinos pay are related primarily to the payment service provider they utilize and will vary from one casino site to another. Fees are a part of life when banking in Canada, so they should not be a surprise at your chosen online casino. 

The upside to using third-party payment providers is the security that accompanies these payment portals. It means that your financial information and money are protected by both the payment provider and the online casino. The system is set up so that you can make deposits to your playing accounts quickly to not miss a beat while playing. Cashouts are much slower and that is mostly to give the online casino operators time to verify your payment request and huge payouts will take even longer. Sometimes the request will be manually approved which adds to the time required. The only exception is payments to e-wallets. These are faster but those requested by debit card or a bank transfer may take time as the bank will need to verify all details.

 

The Selection of Games At An Online Casino

 Software providers are responsible for the game selection at any online casino and this is the same in Canada. So, when wondering how do online casinos work, the games found on one are not owned by the casino. The games are the property of the software provider. This is how the process works: a software provider creates a game. They then operate that casino game on their server and players can access them through an online casino on any platform they use. However, if you find a game stops working properly over time, it is not the fault of the online casino. All the online casino is doing is providing you with access to the software provider's server. A game that is no longer functioning properly is acting up because of an issue with the software provider’s server. 

Progressive jackpot slot machines are a whole different matter. The payouts for these come from the software provider and not directly from the casino. This is because players of progressive slot games are playing the same games from various locations across Canada and very likely in one of many different online casinos. The only way that a progressive jackpot could be accurately paid out is if the amount came from the software provider since that would be the only common source of the gambling activity. And since all online casino games operate on a Random Number Generator system, there is no way to beat the system which keeps everything legal, safe, and legitimate.

 

Online Casino Game Promotions Explained

One of the most interesting things about how gambling works online in Canada is the promotions that are offered by casinos. Because every casino is different, the promotions vary but they all have the same goal in common: to attract new players and to keep them excited about joining a particular online casino. The promotions have various details related to them but typically fall under a handful of the same categories. It is always a good idea to compare the promotional offers from one online casino to the next to see if you can find one that will provide you with a slightly better deal. Remember, online casinos are trying to lure you from their competitors so don’t be surprised to find some great offers and some not-so-great offers. Here is a quick breakdown of the casino promotions that are commonly utilized.

Exclusive Deals - This type of promotion is created by the casino in partnership with another website. The idea here is that to qualify for the bonus (which is often a bonus aggregator), you have to already be a member of the casino that is making the offer. It’s a promotion built upon player retention.

Existing Player Bonus - If you are already a member of an online casino, periodically, you will be offered an Existing Player Bonus. These bonuses can be in the form of reloaded offers, cashback, seasonal or temporary promos. These are intended to keep you as a member of the particular casino so you won’t want to leave.

Free Bonus - This is just an add-on. It is typically a fixed amount of money that is provided by the casino as a “gift” regardless of your deposit level. The goal here is to give a player some extra money to play with that they will use at the casino it came from. This is another retention-type promotion.

Loyalty Offers - These are various bonuses and features that are awarded when a player reaches a pre-determined level. Another retention promotion.

New Player Bonuses - Several different offers fall under this category. They can include such things as welcome bonuses, no deposit, first deposit bonuses, cash matching on your first deposit, etc. These are intended to make you feel welcome and help you to settle in to play at an online casino.

Refer A Friend Deals - As the name implies, each time a friend of yours signs up to join an online casino that you are already a member of, you will receive bonuses in thanks. The goal with this type of offer is to increase the player pool and by reaching for new members from existing members, this becomes a referral program.

Sticky Bonus - This type of promotion features an amount of money that is related to the size of the deposit being made. However, the bonus amount gets deducted from any winnings at withdrawal. In other words, the sticky bonus is used as a loan to play with instead of free money.

 

Other Promotion Terms To Know

When explaining how do online casinos work, many different promotional terms can mean various things at different casinos. Here is a look at them.

Availability - This is related to the time frame of promotions. Typically a promotion will have an expiration date and once it is passed, the deal no longer exists - it becomes unavailable.

Maximum Cashout - This is a limit imposed by the online casino. Regardless of how much a player wins from a promotional deal, only so much money will be permitted to be withdrawn from those winnings. Think of the maximum cashout as the ceiling limit of what you can collect at a given time.

Minimum Deposit - This is another limiting tool but can be either a limit set on how much a player can deposit to play at a specific casino or, it is the minimum limit that may apply to just a promotion.

Wagering Requirement - This is shown as a multiplier and references how many times a player has to wager certain amounts of money. The requirement may apply to just a bonus, a deposit, or winnings. At some casinos, this limit applies to a combination of these three components. If this requirement is not met, winnings from the promotion cannot be cashed out. Also, some promotions do not have wagering requirements.

 

Customer Support At Online Casinos

You can’t discuss how gambling works online in Canada without mentioning customer support. Customer support is where you go if you have questions, encounter issues, or just need a hand with something that doesn’t seem to be covered in the Terms of Service information at the online casino site. Now, there are different ways in which customer support can be offered. Some online casinos provide it in-house and others will outsource it. Various communication channels may be used for customer support including e-mail, live chat, phone, via social media, and sometimes through Skype. 

Of the two main types of customer service available, your best bet is when it is offered in-house. That is because the customer service agents you would be in contact with would be working for the casino and that means they will have a better understanding of the workings of the industry and the specifics of the online casino you are calling about. Outsourced customer support is still fine, however, those agents are not directly connected to the online casino you are seeking help with and may also know less about the online gaming industry in Canada.

 

Are Online Casinos Secure?

We’ve indicated that your money and financial information is protected but how safe are online casinos from hackers? One of the most important things related to how do online casinos work is the data security measures that are in place. These are to protect both players and casinos and include the following security layers:

Firewall - Your computer has a firewall but the online casino you are a member of also has one that is designed to block unwanted access and can detect any kind of suspicious activity on the gaming network.

SSL Encryption - SSL (Secure Socket Layer) Encryption uses a process where data being transferred is first encrypted as it is being transferred and then decrypted when it reached the desired location. While in transit, the data remains encrypted, and should it be intercepted in any way, it cannot be decoded.

Privacy Policy - This spells out what the online casino does with any personal information it collects. To gain a better understanding of these requirements, it is always a good idea to read the fine print you locate on the casino website. 

 

How Online Casinos Turn Profits

Finally, we can’t fully explain how do online casinos work without giving you some details on how they stay in business. It is logical to know that online casinos in Canada make their profit off of the wagers made by their members. The term used to describe the percentage of wagered money on a given casino game that will be provided as winnings to players is called the Return To Player (RTP). An example is a game with an RTP of 90%. This means that if you were to wager $100, you could see $90 of that coming back to you in winnings. The remaining 10% is the House Edge and that describes what the casino earns off of that game. 

To increase their profit, online casinos provide the various promotions and bonus offers outlined above to attract new players and that adds to the amount of money the casino makes. Then there are games where casinos collect a commission before play starts such as poker where a percentage of the bets stays with the casino. If you think that winning big jackpots cuts into the profit, think again. The casinos use a formula (the RTP) that protects them from “giving away” too much money. In other words, casinos are designed to make money and they do it well.

 

In Conclusion

Online gambling in Canada is far from complicated. If you know the basics of any casino game, you will be able to enjoy yourself at any online casino in Canada. Just be sure to follow the guidelines outlined in the casino's Terms of Service and you should be able to have a lot of fun playing casino games from the comfort of your home.

Did you know that Canada is home to a lot of different forms of gambling? Sure, they may come across as quiet and polite neighbors not wanting to rock the boat but once you cross over the 49th Parallel, it doesn’t take long to see that gambling keeps the country rocking. Feel like some casino action? 

Well, in the Great White North you have the option of visiting one of close to 100 different land-based casinos and over 38,000 VLTs. If you like to participate in some sports betting activity, you can place your bets at one of the countless lottery retailers located in everything from shopping mall kiosks to grocery stores, gas stations, and pharmacy counters. Then there’s Bingo. 

Oh, and we can’t forget charity gambling where non-profits get into the action as fundraisers and there are even provincially-operated online gambling sites where sports betting and casino gaming are all in season. However, in Canada, the laws that govern such activity are straightforward with generous sprinklings of grey areas that have yet to be defined. Let’s take a much closer look at how do online casinos work in Canada along with all the other gaming activity taking place just north of us.

 


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