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Innovations and Payment Systems

You may soon be able to buy lottery tickets at grocery checkout


States have to approve shoppers using smartphones linked to credit or debit cards to purchase Powerball and Mega Millions chances.

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Paper, plastic or lottery tickets?

At grocery stores in some states you may soon be able to use your smartphone, linked to your credit or debit card, to buy Powerball or Mega Millions tickets while you’re paying for your cart of groceries in the checkout aisle.

That could save you a long wait to get a lottery ticket when jackpots climb.

The players behind lottery sales in the checkout aisle are Blackhawk Network Holdings, a spinoff of supermarket giant Albertsons’ subsidiary Safeway, and Linq3, a provider of lottery technology, including Play at the Pump.

The big questions about lottery-at-checkout are: When will it start and in which states?

When will it start? Blackhawk expects some states will OK the checkout sales of Powerball and Mega Millions tickets by year-end.

In which states? That depends on whether lottery tickets are sold in your state and where you shop for groceries. Also, odds are that the handful of states that have already approved Play at the Pump lottery ticket sales will greenlight this, too.

More funds for education or more risk of debt
North Carolina Education Lottery spokesman Van Denton says the lottery has discussed the lottery-at-checkout program with Linq3, but hasn’t decided whether to sign up for it.

“In retail sales today, you need to stay on top of changes in technology to stay relevant in the marketplace. Customers expect you to be where they want you to be,” Denton says.

“By staying up with the times, we can attract new customers and build on our success raising money for a good cause.”

Denton says the North Carolina lottery hasn’t done a forecast of how much the lottery-at-checkout program could bump up ticket sales.

“New sales channels such as this would benefit the lottery because they help it meet its mission to raise money for the good cause it serves – education,” he says. “They allow sales of lottery tickets to conveniently occur in places where they weren’t occurring before.”

May Scheve Reardon, executive director of the Missouri Lottery, has a similar take on the lottery-at-checkout offering.

“We are always interested in new technology to help us maximize revenue for Missouri education,” Reardon says.

Not everyone is lining up in support of making it easier to buy lottery tickets, though.

Keith Whyte, executive director of the National Council on Problem Gambling, says, “Obviously, any time you ease or increase access to gaming, you risk increasing or exacerbating gambling problems.”

“In retail sales today, you need to stay on top of changes in technology to stay relevant in the marketplace. Customers expect you to be where they want you to be.”

How lottery at checkout would work
Many grocery stores already sell lottery tickets, typically at their service desks or in special vending machines, but not in checkout lanes – and only 19 of the 44 states that sell lottery tickets let you to pay with a credit card.

That likely would change with lottery sales at checkout.

To buy lottery tickets with your groceries, you’ll need to link your mobile device to an acceptable payment card.

“Shoppers playing lottery games in this new way will activate their purchase via text and have their lottery numbers delivered in real time to a mobile phone with text and picture messaging capability,” Blackhawk’s Aug. 8, 2017, news release says.

“Shoppers will also be able to track their results virtually and have most prizes paid electronically.”

Bonus: No more fumbling with those pesky, easy-to-lose paper tickets. Your lottery tickets are delivered to your phone, and your winnings (up to a certain amount) are deposited in your linked account.

Play-at-the-Pump as a model for lottery at checkout
Lottery players in Play-at-the-Pump states are already familiar with how Linq3’s lottery program works. For example, in most Play-at-the-Pump states, there is a $1 transaction or convenience fee (the term varies by state) charged by the vendor for a processing fee. It is a flat fee and not based on the number of plays purchased.

Players also must be 18 years or older, and states have caps on how much you can spend via Play-at-the-Pump. For example, New Mexico and California limit credit or debit Play-at-the-pump credit and debit to $50 per week, and North Carolina limits purchases to $70 per week per debit card.

Here’s how the summer 2017 edition of World Lottery Association Magazine describes Play at the Pump:

“As the customer swipes a debit or credit card to start the transaction, they are prompted as to whether they want fuel only or lottery plus fuel.

“Debit cards are used by all participating lotteries; some do not allow the use of credit cards for lottery purchases. In those jurisdictions, if a credit card is swiped, no lottery option is presented.”

Winnings of $599 or less are deposited in your Play-at-the-Pump-linked account. For prizes of $600 or more, winners will need to bring their payment card and identification to a state lottery office, the California Lottery notes.

“Any time you ease or increase access to gaming, you risk increasing or exacerbating gambling problems.”

The Albertsons connection
The Blackhawk news release goes on to say that the ability to purchase lottery tickets on your smartphone will come to “participating” grocery stores in “select” states. Which stores and states remains to be seen.

Christine Wilcox, a spokeswoman for Albertsons, which has roughly 2,200 grocery and drug stores in 35 states and Washington, D.C., says she’s not familiar with the lottery-at-checkout program. Albertsons operates stores under various brand names, including Albertsons, Safeway, Vons, Jewel-Osco, Shaw’s, Acme, Tom Thumb, Randalls, United Supermarkets, Pavilions, Star Market, Haggen and Carrs.

Wilcox referred questions to Blackhawk.

But since Blackhawk is a Safeway spinoff, with two of its board members former Safeway executives and Albertsons is one of Blackhawk’s key partners (Blackhawk powers Albertsons’ gift card website, for instance), it may be a smart bet that stores under the Albertsons umbrella might be introducing the mobile-buying function for lottery tickets – if they are in states that approve lottery at checkout.

Asked about the potential involvement of Albertsons, Blackhawk spokeswoman Courtney Brunkow says: “We do not have any partners to announce at this time.”

An added, though small, lottery revenue stream
In Missouri and North Carolina, Play at the Pump hasn’t quite hit the jackpot, so to speak.

The Missouri Lottery says average weekly sales from Play at the Pump total about $5,000. Play at the Pump is available at 859 gas pumps throughout the state. At the pump, the lottery sells only Powerball and Mega Millions Quick Pick tickets, and players can pay only with debit cards.

“While our Play at the Pump sales don’t currently make up a large portion of our sales, it does provide an added convenience for our players and will become more profitable as awareness grows,” Reardon says.

In North Carolina, Play at the Pump ticket sales have been anemic at the 2,801 gas pumps where they’re offered.

Denton says Play at the Pump sales average $42,095 a month, with total revenue at nearly $2.07 million from January 2015 through July 2017. During the state’s last fiscal year, the lottery reported ticket sales of $2.4 billion.

“Play at the Pump is a small but growing part of our lottery’s sales channels,” Denton says.

Reducing the risk of overspending on lottery tickets
Whyte, executive director of the National Council on Problem Gambling, says his group has worked with Linq3, a member of the council, to develop messaging that encourages lottery players to gamble responsibly.

Of the lottery-at-checkout venture, Whyte says: “Just as advances in technology provide new ways to gamble, they provide new challenges and opportunities for responsible gaming.”

Will you be able to buy lottery tickets when you’re paying for your cart full of groceries? It’s going to depend on where you live and maybe where you shop.

That said, chances you’ll be able to buy lottery tickets on your smartphone one day are far better than the odds that you’ll win a jackpot.

See related: 5 reasons you don’t really want to win the lottery, Buy lottery tickets with a credit card? Probably not,  6 steps to handle a sudden financial windfall

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