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Why do Exchanges charge commission?

This may have been asked & answered elsewhere, but I couldn’t find a post.

Why do betting exchanges think it’s OK to charge commission on winnings, when the split between back and lay odds already looks to guarantee them a margin?

If you look at the live odds for any event, the current back odds will always be a point or two lower than the lay odds. Is there a reason for this that I haven’t understood, other than the exchange creaming off a small profit on every stake?

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Neil S
76

September 8, 2022 at 4:32 pm

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Matt
Keymaster
1495 September 12, 2022 at 11:21 am

Betting exchanges are peer-to-peer betting platforms, Neil. It’s not the exchange that keeps your stake or pays you your winnings; it’s someone else betting on the platform.

The commission charged on winnings is simply their reward for providing us with a platform on which we can bet against other people.

I hope that helps.

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Neil S 76 September 12, 2022 at 11:48 am

Thanks Matt – that much makes sense. But what I’m still curious about is why the lay odds are always higher than the back odds.

Surely, if I want to back a horse on the exchange at odds of, say, 3.0 then I should be able to lay the bet at 3.0 too, because that’s just effectively another punter backing at those odds?

Is it even technically possible for the lay odds to be lower?

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