Regulator likely to refuse a proposal by National Lottery operator to enhance the functionality of its ticket terminals.
Camelot was looking to improve the capabilities of its portfolio of over 25,000 lottery ticket terminals and allow consumers to use the terminals to top up mobile phones and make bill payments in addition to purchasing lottery tickets.
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But the National Lottery Commission (NLC) said that it is "minded to refuse" Camelot's request on competition grounds.
Had the plans for payment functionality gone ahead, Camelot was hoping to team up with banking giants Santander and the Co-operative Bank, as well as with the Post Office, to allow payments on council tax as well as on utility bills.
In order to process the payments, barcode readers on the terminals would be used to verify the bills and a magnetic swipe card would be used to make the payment.
Camelot has been quoted as labelling the Commission's decision as "flawed".
However, the NLC says this is a provisional decision and that representations will be considered until 3 September, when a final decision will be made.