Credit, settling up and collections
A local bookie mostly works on credit. Nothing changes hands during the week, and on settle day the losers pay and the winners get paid. The software can do every other part of the job, but not that one, and it is where most bookies fail.
The law, plainly
Taking bets without a license is against the law in most places, and whether you may do it at all depends on where you live. Owing a bookie money doesn't change that. A bookie working outside the law also has no court to take a debt to, which is a fact worth knowing from both sides of the arrangement. Nothing here is legal advice.
How credit works
Each player gets a credit limit: how far down he can go before the account stops taking bets. He also gets a settle figure, the balance at which money actually changes hands. Below it, the balance usually carries over to next week.
Say a player has a $2,000 limit and a $500 settle figure. He finishes the week down $350, so nothing is paid and the $350 carries. He finishes the next week down another $300, so he is down $650, past the figure, and he pays $650. A winner works the same way in reverse: a player up more than his figure is paid. Most bookies settle once a week on a fixed day, and some run a player until he is up or down a set amount instead.
The limit is the decision that matters. I'd set it by what the man can pay out of his pocket in a bad week, never by what he wants to bet. A player who can't cover the limit he has been given is a bad debt you created yourself.
Settle day
When a bookie rents his site from a pay-per-head office, the office takes the bets, grades them and prints the weekly figure for each player. What it doesn't do is pay or collect: that is the agent's only job once his players are in the office. The office sends him a bill for its heads and he keeps whatever is left.
Say a week ends like this, with seven players in action at $10 a head.
| Player | Figure |
|---|---|
| A | owes $450 |
| B | is owed $1,200 |
| C | owes $800 |
| D | is owed $300 |
| E | owes $1,600 |
| F | owes $2,250 |
| G | is owed $2,400 |
The losers owe $5,100 and the winners are owed $3,900. The book is up $1,200, and $1,130 after the $70 fee. That is a good week on paper.
Now say F is late. Without his $2,250 the bookie has collected $2,850 and owes $3,900. He is $1,050 short on settle day in a winning week, and he has to find it from his own money.
That is the part beginners miss. A bookie needs cash behind him not only for the weeks his players win, but for the weeks his losers pay late. I'd pay B, D and G in full on the day regardless, and chase F after. The winners shouldn't wait because someone else is slow, and the first time a bookie makes them wait, he has told them what kind of book he is.
Collecting
Most collecting is just being regular about it, on the same day, in the same place and on terms agreed before the first bet, so that nobody can say later he didn't know what was expected of him. A player who knows the figure is due on Tuesday mostly pays on Tuesday. A player who is allowed to slide one week will slide the next.
When a player is behind, the first step is the one the software makes easy: stop his action. Close the account to new bets until he settles, and don't raise his limit to let him chase it. A player who is losing and can't pay will try to bet his way out, and a bookie who lets him is betting with money he doesn't have.
Some debts don't come back. The bookie writes it off and carries the lesson into the next limit he sets, which is the only return he will ever see on that money. Collecting with threats is a crime, and I'd have nothing to do with anyone who does it or anyone who offers to.
The deposit scam
Players looking for a credit account online often run into one trick. Someone offering to be their agent asks for a deposit first, and promises a credit line of, say, double what they send. The player sends the money, and that is the last he hears of it.
Credit means you don't put money up. Anyone who asks for a deposit to open a credit account is asking you to post up with a stranger who has no book behind him and no reason to pay you. If you want to bet with money up front, do it with a book you can check, and read the withdrawals page before you send anything.
For the player on credit, the same arithmetic applies from the other side. The limit is the most the bookie will let you owe, not a budget. Pick your own figure below it, the amount you can pay on settle day without thinking twice, and stop there. The exposure page explains why the bookie is doing the same sum.