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Nigerians changing the way they bet

Thu, Jan 10, 10:53am by Staff Writer

A global provider of games and e-sports analytics has revealed that Nigeria is currently generating the second highest gaming revenue in Africa behind Egypt. New Zoo’s Global Games Market report shows that Nigeria generated $180 million in revenue while Egypt secured top spot with $286 million between January and October 2018.

This news solidifies Nigeria’s growing stature in online gambling despite no Nigeria online casinos being operational since the launch of a now defunct operation in 2013.

Algeria generated the third most revenue at $142 million, while South Africa made $129 million and Kenya $31 million.

According to Reuters, online sports betting is booming in the soccer-mad nation due to payment systems developed by local technology, enabling online businesses to be more viable.

Fear of electronic fraud and slow Internet speeds have held Nigerian online consumers back but betting firms say new, fasting digital payment systems underpinning their websites are changing attitudes towards online transactions.

“We have seen significant growth in the number of payment solutions that are available. All that is definitely changing the gaming space,” chief executive officer of Lagos State Lotteries Board Seun Anibaba said.

Taxes from sports betting in Lagos State rose 30 per cent to 40 per cent between 2016 and 2017 according to Mr Anibaba.

New digital payment systems give rise to growth

This growth has been matched by a rise in digital payments according to data from the Nigeria Inter-Bank Settlment System.

In 2016, there were 14 million web payments worth 132 billion naira ($420 million). Transactions leapt to 29 million worth 185 billion naira in 2017.

Nigeria’s young population, rising mobile phone use and falling data costs has presented an opportunity for online businesses, as consumers are becoming increasingly comfortable with electronic payments.

British online betting firm Betway opened its first African business in Kenya in 2015, followed by Uganda, Ghana and South Africa. It launched in Nigeria a year ago.

“The growth in the number of fintechs, and the government as an enabler, has helped the business to thrive. These technology shifts encouraged Betway to start operating in Nigeria,” Betway Nigeria manager Lere Awokoya said.

Betting firms cashed in one the soccer frenzy whipped up by the 2018 World Cup with local payment start ups proving popular.

Paystack and another local startup Flutterwave, both founded in 2016, are providing competition for Nigeria’s Interswitch, which was developed in 2002.

The founder of NairabBET, Nigeria’s second biggest betting firm added Paystack to its payment options without any fanfare or announcement. It rose to the most used payment option on the website within a month.

NairabBet founder Akin Alabi said the firm now had 2 million regular customers, up from 500,000 in 2013.

Shifts in Nigeria’s payment culture have coincided with the arrival of foreign investors hoping to cash in on the sports betting boom.

Russia’s 1XBet and Slovakia’s DOXXbet have both set up in Nigeria in recent years, while Italy’s Goldbet was ahead of the trend, taking a 50 per cent stake in Bet9ja when the Nigerian firm launched in 2015.

Mr Alabi said NairabBET sales were split between shops and online but the ease of electronic payments, cost of running shops and the ability for customers to avoid the stigma of gambling in public meant online transactions have grown.

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