The New South Wales government on 26 August outlined a gambling reform programme that will require pubs and clubs with gaming machines to introduce facial recognition at gaming-room entrances from 2028, alongside a statewide self-exclusion register and tighter marketing controls. The measures matter for Australia’s largest poker machine market because they would replace venue-by-venue exclusion monitoring with a central system, increase compliance obligations for licence holders and accelerate the removal of gaming machine entitlements.
The package combines planned regulatory changes, technology upgrades and funding measures aimed at reducing gambling-related harm and improving anti-money-laundering controls. It also includes a ban on gaming-linked VIP programmes, restrictions on unsolicited direct marketing by betting service providers and a prohibition on gambling advertising displayed on assets owned by the NSW Government or local councils.
The reforms follow findings from the NSW Gambling Survey 2024, which reported that 3.1% of the state’s adult population experienced moderate-risk gambling and 0.9% were classified as experiencing high-risk gambling. While those figures represent a minority of adults, they provide the policy basis for a broader intervention in a market where gaming machines are widely operated by licensed hotels and registered clubs.
Under the planned statewide exclusion register, a person who elects to exclude themselves from gaming areas would be covered across every NSW pub and club operating gaming machines. The present arrangements are fragmented, with customers generally able to nominate individual venues or groups of venues for exclusion. Monitoring is largely handled at the venue level by operators and staff.
The government said the central register would be introduced with mandatory facial recognition technology in 2028. The technology is intended to help venues identify people who have entered into self-exclusion arrangements before they access gaming rooms, rather than relying only on staff recognition or local records.
For operators, the change would establish a more consistent exclusion obligation across the state, but it will also require investment in equipment, systems integration, staff procedures and data governance. Hotels and clubs will need processes for dealing with potential matches, handling customers who contest identification and ensuring that excluded patrons do not gain access to gaming areas.
The government said privacy experts had been consulted during the development of the reforms. However, the operational detail of the facial recognition framework, including data retention rules, system accuracy requirements, audit processes and complaint mechanisms, has not been set out in the announcement. Those areas are likely to be central to the eventual implementation, particularly because biometric information carries greater privacy and security risks than conventional venue records.
A statewide scheme may reduce the scope for excluded customers to move between venues, which has been a limitation of localised arrangements. At the same time, the effectiveness of the system will depend on the accuracy of facial matching technology and the consistency of procedures applied by thousands of venue employees. False matches and failures to identify excluded patrons could create operational and regulatory issues, while smaller regional venues may face a proportionately higher compliance burden.
The programme also addresses the state’s Centralised Monitoring System, which is to be upgraded over the next two years to support a future move toward account-based gaming. The existing monitoring infrastructure has been described by the government as legacy technology that has slowed the adoption of cashless or account-linked gambling systems.
The government said developments following its Cashless Gaming Trial showed that account-based play could provide both anti-money-laundering and harm-minimisation benefits. Such systems can create clearer transaction records and potentially allow the application of player-management tools. The administration said customers would still be able to use cash if they chose, indicating that the proposed transition is not framed as an immediate mandatory cashless gaming requirement.
The distinction is significant for the sector. Account-based gaming has been politically contentious in NSW, where clubs and hotels have raised concerns about customer privacy, implementation costs and the impact on venue trade. Harm-minimisation advocates have argued that account-linked systems can provide stronger oversight of expenditure and enable more effective interventions. The government’s approach appears to place the immediate emphasis on upgrading the technical platform needed for future account-based functionality rather than setting a deadline for universal cashless play.
The measures will also alter the marketing environment for gambling businesses. VIP programmes linked to gaming are to be prohibited, removing a channel through which venues may offer incentives or preferential treatment to higher-value machine players. The government did not provide further details on the scope of the ban, including how it will distinguish gaming-linked programmes from broader hospitality loyalty schemes.
Betting service providers will be barred from contacting prospective customers by telephone, email or text message unless they have received express consent in advance. The requirement would strengthen the consent threshold for direct marketing and may require wagering businesses to review customer acquisition records and marketing databases.
Additional transparency obligations will apply to promotions involving affiliates and social media influencers. The reform programme also proposes restrictions on commissions associated with higher-risk gambling products. These provisions place greater attention on third-party marketing arrangements, where operators may have less direct control over the format and audience of advertising but remain exposed to regulatory scrutiny.
The ban on gambling advertising across state government and council-owned assets extends the policy beyond licensed operators. It could affect advertising inventory at public facilities, transport-related sites and local government property, depending on how the final rules define covered assets. Councils and public bodies with existing commercial arrangements may need to review those contracts before any prohibition takes effect.
Gaming machine numbers will be reduced through changes to the entitlement trading system. NSW has about 87,000 gaming machines across approximately 2,100 clubs and hotels. When machine entitlements are traded between venues, the forfeiture rate will rise from one in three to one in two. Under the revised approach, one entitlement would be permanently removed for every two that are transferred.
The government will also introduce a sinking cap, designed to lower the statewide ceiling on gaming machines as entitlements leave circulation. This mechanism would reduce the maximum number of machines permitted in the market over time rather than maintaining a fixed cap despite entitlement forfeitures.
For venues seeking to acquire machines through entitlement transfers, the higher forfeiture rate means fewer entitlements will remain available after transactions. That could limit expansion options for operators, particularly in areas where machine demand remains strong. It could also affect the value of entitlements and the strategic decisions of clubs and hotels considering mergers, relocations or venue investment.
Conversely, the reduction mechanism does not necessarily mean an immediate fall in the number of active machines at every venue. Its pace will depend on the volume of entitlement trades and on entitlements otherwise leaving the system. The government has not provided a projected annual reduction figure or a revised statewide cap in its announcement.
The reforms are supported by AU$95.2 million in funding over four years. The money will come from the remaining balance of the state’s AU$100 million gambling harm-minimisation fund and increased licence fees for clubs and hotels that operate gaming machines. The funding model means the sector will contribute more directly to the cost of the compliance and harm-minimisation programme.
Higher licence fees may be more manageable for larger venue groups than for smaller clubs and independent hotels with limited administrative capacity. Industry participants are also likely to seek clarity on how fees will be calculated, whether costs will vary by machine numbers or venue size, and how funding will be allocated between technology, support services, enforcement and administration.
Gaming and Racing Minister David Harris said the package had been developed through engagement with industry representatives, harm-minimisation groups, other stakeholders and privacy specialists. He said the reforms combined technology, exclusion measures, regulation and funding while taking account of the industry and its workforce.
The announcement does not remove the need for detailed legal and operational design. Rules governing facial recognition, exclusions, data sharing, marketing consent and machine entitlement forfeiture will need to be translated into enforceable requirements. Depending on the measure, implementation may require legislation, regulations, licence condition amendments or administrative directions from the relevant NSW authorities.
The government has set 2028 as the target for the statewide exclusion register and mandatory facial recognition at gaming-room entrances, while work on the Centralised Monitoring System is expected to proceed over the next two years. Operators, local authorities, privacy bodies and gambling harm-minimisation organisations will now await the detailed implementation timetable, technical standards and enforcement arrangements that will determine how the reforms operate in practice.
Sarah Thompson is an editorial byline used by Casino No Deposits for industry news coverage. Articles published under this byline are summarised from reporting by licensed gambling industry news sources and produced with AI assistance, then published against our editorial rules on accuracy, sourcing and tone. They are not first-hand reporting and do not contain personal player accounts. Our full process, including how bonus listings and ratings are maintained separately by our team, is documented in how we review casinos: https://casinonodeposits.com/how-we-review-casinos/
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