What is the rake?

There are many things that make poker the best game to play - more skill, more fun - but the key advantage is that you are up against the other players around the table and, over time, the best players will win as the luck evens out and the skill takes over. Unlike blackjack and the other table games, there's no house edge to give the casino operator a guaranteed percentage. You take your winnings out of the pockets of those you beat. From the point of view of the casino, this is bad news. Here it is with its capital tied up in bricks and mortar and its outgoings burdened with a staff of dealers, and it has no edge to help cover its costs.

So, it charges the players for the right to sit down and play the game. This fee is called the "rake" because the dealer physically rakes in chips at the end of each hand to cover the fee. The amount varies. Sometimes, in the more exclusive rooms, it can be as high as 10% per hand, but it's usually capped and falls to very small percentages when big bets are made.

The fact that you play online does not change the economics of the casino's operation. There may only be one small building and very few staff, but it costs money to install and maintain the software. Servers have to be paid for to host the games. So the casino must still cover its costs when offering a poker room. The advantage is that the costs of virtual operation are significantly less than the real world costs and so the rake percentage is usually lower and capped. On a $50 pot, the rake might be 5% but on a $500 pot it might be 0.5%. So high stakes or no-limit players might pay only a small rake. Whereas small pot players could pay quite high fees except that most online casinos cap the amount per hand at no more than a sum between $3 and $5. Nevertheless, the amount of the rake paid over a month might be substantial for regular players.

If you play online, the rakeback system has been introduced to allow the casinos to compete against each other for players. The idea is simple. Every month, your account is credited with a percentage of the total rake you have paid. That reduces the casino's margin but encourages regular players to stay loyal and to play for longer periods of time - remember online players go through more hands per hour than real world players. The refund makes a big difference and often represents the chance for the regular players to turn from losing to winning. If you only play for small pots, you are playing against the others around the table and the house fees. With the rakeback offering as much as a 40% refund, this can quickly mount up, e.g. if you played 1,000 pots at a capped fee of $3, you will recover $1,200 at the end of the month. This is "free money" for you to play with at the start of the next month and a very good reason for signing up for this facility.

Hopefully well.