Setting up a spread betting account is much simpler than most people imagine. The spread firms want to widen their audience appeal and the only way for them to do that successfully is to make it as easy as possible to open an account. We will examine in a later chapter some of the limited risk options that are on offer to the more wary gambler, but in effect there are two options for new accounts.
The first is a debit account. This involves clients making funds available either by sending money to the firms to deposit in an account or directly debiting their bank accounts by Switch card before placing a spread bet. This is fast becoming a popular option, especially for newer devotees of spread betting who want to know the maximum they might lose before they bet. Losses are taken directly from the bank account and winnings paid directly in. Depending on the firm, interest may be paid on deposit accounts (Spreadex pay a very attractive 6 per cent).
The second and more traditional type of account is a credit account. This requires providing proof of funds to the spread firms in terms of bank and building society statements usually covering three times the required weekly credit limit. So a client wanting £1,000 credit would have to show they have liquid funds to the order of £3,000. Accounts are usually settled weekly, with either a cheque or bill in the post. Options are available for money to be transferred into and out of bank accounts directly if clients so desire through BACS (Bankers Automated Clearing System). This means that cleared funds can be transferred on a weekly basis without the trouble of cheques.