Product
Rakeback
Definition
A share of the rake a player has paid returned to them as a loyalty reward, either directly by the poker room as a percentage or through a loyalty programme of points, tiers and cash rewards, and historically through affiliates who split their commission with the players they referred.
Key takeaways
- Rakeback returns part of the rake a player paid, lowering their effective rake; volume players choose rooms by it.
- It is paid directly as a percentage or through points-based loyalty tiers, both a cost against poker revenue.
- Rakeback that mainly rewards winning players can drain a poker ecosystem; rooms have restructured schemes because of it.
- Affiliate-passed rakeback is restricted by many rooms and treated as an inducement by some regulators.
Why it matters
Rakeback exists because rake is visible. A poker player can calculate what they have paid a room to the penny, and a room that returns part of it lowers the effective rake, which is the single number a high-volume player uses to choose where to play. A player paying 2,000 a month in rake at 30 per cent rakeback has an effective rake 30 per cent lower than at a room paying none, and the difference is the margin between a winning and a losing year for many regulars.
Rooms use rakeback deliberately. Direct rakeback, a flat percentage paid regularly, is simple and attracts grinders. Tiered loyalty schemes, in which points earned per rake convert to rewards at rates that rise with volume, reward the same players while giving the room control over who gets what. Both are a cost against poker revenue, and the room's calculation is whether the volume the rakeback retains is worth more than the rake it gives up. Rakeback that mostly flows to winning players, who take money from recreational players and then leave with a rebate on top, has been blamed for hollowing out poker ecosystems, and several rooms restructured their schemes to favour recreational play.
Affiliate rakeback, in which an affiliate paid a revenue share by the room passed part of it to the players it referred, was widespread in poker's boom years and is restricted or prohibited by many rooms and by some regulators as an unauthorised inducement.
Frequently asked questions
How is rakeback calculated?
As a percentage of the rake attributed to the player, which rooms attribute either by dealt hands, by contributed money or by weighted contribution. The attribution method changes the amount noticeably.
Is rakeback the same as a loyalty programme?
Loyalty programmes are rakeback by another route: rake earns points, points convert to rewards, and the conversion rate is the effective rakeback percentage.
Why do some rooms limit rakeback?
Because it disproportionately rewards winning players, who take money from recreational players and then receive a rebate, which accelerates the loss of the recreational players the room needs.