Is Africa the next growth area for regulated iGaming?

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When looking at global regions experiencing rapid growth in online betting and gambling, most thoughts turn to Latin America’s burgeoning opportunities.

While Brazil and other Latin American countries indeed represent a golden ticket for the industry, some have claimed Africa offers an equally exciting opportunity for those seeking global expansion.

In fact, even a quick look at population demographic charts shows the extraordinary growth that many African nations are currently experiencing and will continue to experience throughout the remainder of this century. Nigeria For example, in 2050 around 10% of all babies will be born in Germany.

Additionally, many African countries are experiencing economic growth, which is conducive to a growing gambling market. As a result, gambling regulators are trying to keep up with other regions of the world to attract operators and providers into their jurisdictions.

Besides that, CasinoBeats came along with Ivo Doroteia, Chairman of the board of Engineering playbook And Dmitry StarostenkovChairman of the board of Evenbet Gaming to discuss the potential of African markets in 2024 and beyond.

CasinoBeats: More and more regulators in Africa appear to be increasing their efforts to bring their regions into line and replicate activities in traditional jurisdictions in the rest of the world. But what progress is being made and how is this transferred to the suppliers invested on the continent and ultimately to the players?

Ivo Doroteia, CEO, Playbook Engineering: Having spent part of my life in Africa, I am proud to see that the continent is currently experiencing a real boom, especially when it comes to sports betting. The Africa Cup of Nations is getting 2024 off to a whirlwind start. It’s a smart move by African regulators, mirroring the regulation of established jurisdictions around the world.

Many of these areas have proven successful over the last decade and following in their footsteps will strengthen the prospects for Africa as a whole. There is definitely progress, also because Africa has the youngest population in the world, so sports betting takes on a different context compared to neighboring continents. Suppliers are aware of demographic developments and the region can look forward to strong growth in the coming years.

CB: A recent push in Nigeria saw 43 betting and lottery operators prosecuted for unlicensed activities – how common are incidents like this in the many African markets?

ID: Gray markets and unlicensed businesses are not just limited to Africa – they are still asserting their place on the world stage. However, unfortunately Africa seems to be something of a hub for this at the moment and a continent-wide crackdown needs to take place. The quicker unlicensed activity is identified and targeted, the sooner regulators can begin to provide Africa’s diverse markets with the building blocks they need to become a region that suppliers and operators keep a closer eye on and ultimately be able to take with you the seriousness of the market potential.

Dmitry Starostenkov, CEO, Evenbet: This particular case aligns with the findings we discovered in our recent e-book on igaming trends in 2023. Regulation was cited as the most pressing issue by 29% of companies we surveyed, and 16% of respondents also cited it as a top trend for 2024.

The legal framework for iGaming in Africa is still evolving, and our report found that there is often uncertainty around entry barriers, licensing requirements and acceptable business practices in such emerging markets. Companies must closely monitor developments and exercise caution as they enter this complex, fluid regulatory environment across Africa.

CB: Do you think other regulators will follow suit to keep pace?

Dmitry Starostenkov
Dmitry Starostenkov, CEO of EvenBet. Image: EvenBet Gaming

ID: There is definitely significant untapped potential in Africa and I believe that the region will eventually follow a similar path to Latin America. Obviously there is still a lot of work to be done to eradicate all illegal activity, but the continent as a whole is becoming more and more regulated, although it will be a long way to achieve what Latin America seems to have achieved in recent years.

D.S: I do – our research shows that ambiguity in emerging markets creates compliance and marketability challenges. As internet penetration increases across Africa and remote gambling expands rapidly, regulators are under pressure to ensure proper regulatory oversight.

It is likely that other authorities will follow Nigeria’s lead and blacklist or block unregulated websites either preemptively or reactively. Stricter licensing protocols could also be introduced, as expansion appears to be a key focus for many companies and regulators will therefore seek to restrict uncontrolled activity. However, heavy-handed measures could backfire, and African officials need balanced policies that encourage licensed iGaming while maintaining healthy competition.

I expect more regulators to take action to formalize the African igaming space. The future appears to lie in increased governance rather than an uncontrolled “hunt for all”.

CB: Specific activities were reported in French-speaking African countries and talked about how different it is to operate in these regions. How does the approach for suppliers compare from country to country?

ID: Malawi is a prime example of how a French-speaking African country has an easier life than many of its neighbors. Betting launched here in 2015 and has seen rapid growth over the past nine years, with operators establishing a presence across this vast region. The success has allowed operators to adopt a similar approach in other sub-Saharan countries, such as English-speaking areas such as Ghana also conquer a corner of the market. While it has proven easier for French-speaking countries to navigate, English regions are now becoming familiar with this area.

D.S: From what I understand, regulatory uncertainty is greater in French-speaking countries, which presents significant compliance challenges for suppliers compared to more established markets. Additionally, internet penetration is increasing more slowly in Francophone African countries, with only certain countries such as Senegal reaching the continent average of 43%. Additionally, the slow growth of e-commerce and the lack of adoption of digital payments have led to increased cash flow in the black market.

In English-speaking countries the regulations are better known, which reduces some hurdles. However, across Africa, suppliers still require in-depth market knowledge. What works in Nigeria may not work in Nigeria Kenya. Understanding languages, cultures, digital infrastructure and gambling preferences is crucial for localization.

CB: Where does Africa stand in 2023 – is it too big and diverse to be viewed as a whole and is this being realized as it has been touted as the next big area of ​​opportunity for many years?

ID: Governments across Africa are struggling to keep up with the mass expansion of online gambling and it shows no signs of slowing down. It is a large and diverse continent and although the opportunities are not yet being fully exploited, I believe that they will be in the not too distant future. It should look at LatAm as a blueprint.

Although Africa is the second largest continent in the world in terms of size and population, it can translate the good performance of individual markets in the Latin America region into its future plans. So far, mirroring traditional jurisdictions has proven to be a good move. So following in the footsteps and drawing lessons from the experiences of an entire continent could bring Africa into the conversation about opportunity by 2025.

DS: Based on our findings, Africa represents great future potential for the iGaming industry, but the landscape across the continent is certainly complex and diverse. The report highlights that many companies are eyeing expansion into Africa due to the large addressable market and growing internet penetration in the region. With 24% of people we surveyed citing technological advancements as their biggest industry growth trend, it makes sense that interest in the market is growing.

However, the results also make it clear that Africa is anything but a monolith. Regulatory approaches, digital infrastructure, culture and languages ​​vary greatly across many countries. Progress has certainly been made in key markets such as Nigeria and other countries South Africa However, where the regulations are clearer, ambiguity remains in other countries. But with strategies tailored to capitalize on each country’s unique dynamics, opportunities across Africa appear closer than ever before.

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