Adults aged 25 and over will face a £5 stake limit “to counter the increased risk of significant harm and life-changing losses” from online slots, the Department for Culture, Media and Sport (DCMS) said.
There is currently no limit on the amount that gamblers can stake on online slots.
In 2019 the Government imposed a limit on stakes on the equivalent machines in betting shops – called fixed-odds betting terminals – from £100 to £2.
The DCMS described the new limits as a “landmark moment” for the regulation of online gambling.
Easily accessible online slot games are one of the most addictive forms of gambling, and can be associated with large losses, long sessions, and binge play, according to evidence presented during a consultation over the proposals contained in the Government’s gambling White Paper.
Evidence from the Office for Health Improvement and Disparities showed that young adults could be particularly vulnerable to gambling-related harm, with under-25s having the highest average problem gambling score of any age group.
NHS survey figures also showed a problem gambling rate of 8.7% for online gambling on slots, casino or bingo games – one of the highest rates across gambling activities.
Young adults had lower disposable income, ongoing neurological development impacting risk perception and common life stage factors such as managing money for the first time, the DCMS said.
Evidence also pointed to a stronger link between gambling-related harm and suicide among young adults.
Gambling minister Stuart Andrew said: “Although millions of people gamble safely every single day, the evidence shows that there is a significantly higher problem gambling rate for online slot games.
“We also know that young adults can be more vulnerable when it comes to gambling-related harms, which is why we committed to addressing both of these issues in our White Paper.
“The growing popularity of online gambling is clear to see, so this announcement will level the playing field with the land-based sector and is the next step in a host of measures being introduced this year that will protect people from gambling harms.”
Zoe Osmond, chief executive of gambling charity GambleAware, said: “We welcome the Government’s announcement to introduce lower online stake limits for under-25s as an important mechanism to protect young people.
“Our research shows a concerning trend with this age group experiencing an increase in harm arising from gambling and online slots are very high-risk products.
“As we continue our work to tackle this growing public health issue, we will collaborate with the Government and others across the gambling harms sector to ensure there are no missed opportunities when it comes to the introduction of robust preventative measures, including new regulations such as these.”
However other campaigners described the limits as a “missed opportunity” after calling for a maximum of £2 or less across the board.
Gambling with Lives co-founder Charles Ritchie said: “The £2 limit for under-25s is a step in the right direction, but £5 for over-25s is another missed opportunity to stop the harm to millions and the devastation caused by gambling suicides.
“Stake limits offer some reduction in harm but the products are still highly addictive, so we also need much slower spin speeds, affordability checks, and proper public health information about the dangers.”
The limits will come into force in September following secondary legislation, with a six-week transition period for operators to become compliant with the general £5 stake limit rules, followed by a further six weeks for the development of any necessary technical solutions to ensure operators are fully compliant with the lower stake limit of £2 for younger adults.
The DCMS said responses to the wider White Paper measures would be published “soon”.