The Massachusetts Lottery is pushing to modernize its operations by adopting cashless online sales as a means of generating more funds for local towns and cities. The office of the Massachusetts State Treasurer submitted two proposals for approval by the state legislature. If approved, the proposals would enable state residents to pay with their debit cards when purchasing Mega Million tickets and other lottery products.
The Executive Director of the Massachusetts Lottery, Mr. Michael Sweeney, explained in a recent interview the lottery is at risk of becoming obsolete if it fails to take advantage of the advancements in technology. Like all other businesses, the lottery must modernize and make use of new technologies to survive, Mr. Sweeney warned. The Executive Director proceeded to explain the two proposals exclude the use of credit cards for lottery-related purchases.
Various precautions would be in place to facilitate responsible online play. Customers would undergo age verification checks and will be able to impose restrictions on their online lottery purchases. Massachusetts Governor Charlie Baker also embraces the authorization of online lottery sales, tackling the subject in this year’s preliminary budget.
Officials from the Governor’s administration claim that the authorization of debit-card purchases could generate as much as $35 million for the state during the forthcoming fiscal year. This is on top of the $35 million the Bay State anticipates from legalized sports wagering.
The attempts to modernize the local lottery system come after Massachusetts’ legislators unveiled plans to legalize sports wagering across racetracks and casinos. If their plans come to fruition, local punters will also be able to place bets via mobile platforms like DraftKings. However, the looming legalization of sports betting threatens the profits of the state lottery.
A major portion of this money is intended for the funding of schools and other socially beneficial projects. The state lottery generated record revenues of $1.1 billion during the fiscal 2019 alone. According to State Treasurer Deborah Goldberg, the concerns of the lottery losing part of its business to online gambling operators were validated in 2020.
Lottery Sales Dropped by $244 Million from March to April 2020
Last year, many retail businesses had to shut their doors to stop the spread of the coronavirus. As a result, the sales of the Massachusetts Lottery took a significant hit, dropping by over $244 million from March to April, compared to the results for the same period in 2019. Treasurer Goldberg thinks the pandemic has irreversibly changed the consumers’ behavior.
She believes the shift from retail to online will continue in the future even after the pandemic eases up. Goldberg gave as an example other retail businesses, many of which have already shifted to e-commerce. It would be difficult, if not altogether impossible, for consumers to return to in-person purchases now they have witnessed the convenience and security of cashless online transactions, the State Treasurer concluded.
But not everyone welcomes the idea of cashless lottery sales. Critics point out this transition could result in more social harms than benefits, especially now that so many state residents have fallen prey to desperation. One such person is Les Bernal from the non-profit organization Stop Predatory Gambling.
Bernal is confident the public demand for the cashless sale of lottery products is insufficient. The state lawmakers risk triggering an epidemic of adolescent betting if they approve online lottery purchases, he cautioned.