The online gambling market in Kenya is much debated. While there is no question that the booming industry has many benefits, there are also a few noted challenges. The job market has increased and tax revenue has surged. On the other hand, problem gambling has also seen a big increase. Let’s take a closer look at the ballooning online gambling market in what is being called Africa’s new technology hub.
Back in 2016 Kenyatta University engaged in some interesting research. A poll took place that gave a deeper look into Kenya’s local sports betting trends. What came to light was that 78% of male students and 57% of female students engaged in betting. Almost 50% put down a bet at least once per week. The numbers far exceeded expectations, revealing an interesting insight into local trends. By 2018 it was revealed that $1.3 billion was spent on betting annually.
Similar statistics are seen in the gambling industry in Tanzania, South Africa, Nigeria, Ghana, and Uganda. As a whole, the African continent is a hive of sports betting activity.
The Industry Challenges
When a market explodes there are always going to be challenges. A student at Kenyatta University Nelson Bwire launched another poll in 2020. He focused on problem gambling trends. His research revealed the unsettling truth that 7 out of 10 students show signs of problem gambling. Some students have even had to abandon their studies after losing tuition money.
Shocked at his discovery Bwire opened the Gaming Awareness Society Of Kenya. The aim of the organization is to raise awareness about problem gambling while also acting as a safe haven. Kenyan students struggling with gambling can make contact to receive free counseling.
It’s due to these realities that some have suggested that betting be banned across Kenya. The notion is supported by some lawmakers, but the situation is more complicated than it seems.
The Challenges of Regulations
In many Middle Eastern and Asian regions betting is banned outright. The same isn’t likely for Kenya. Amongst other factors, online betting is a major source of tax income for the region. Gambling is also responsible for creating thousands of jobs. These realities make it difficult to ban betting, but don’t mean that regulations can’t be tighter.
A bill in 2019 aimed at giving Kenyan watchdog authorities more power. The bill failed, with many assuming that the government feared the inevitable consequences. Even still there are signs that the government is serious about bringing the industry under control.
New taxes have been introduced on betting and winnings. This alone helped curb excessive betting. More so a new law that granted the Central Bank the power to regulate digital money lenders. The Betting Control And Licensing Board (BCLB) has also been instrumental in cracking down. It wasn’t long ago that the authority prohibited betting companies from advertising during daylight hours. A big step in bringing a degree of control.
July 2019 saw the BCLB refuse to renew 27 operator licenses. The organizations were behind on tax payments, and almost all were forced to close. An unprecedented move that paved the way for a stronger stance by the government.
Real Regulatory Impact
Peter Mbugi is a director at the BCLB. He gave further insight into recent industry developments. According to him the total amount staked in 2021 is lower than in 2019. He sees this as a success as far as regulations and gambling awareness is concerned. Others disagree saying that the reduced numbers are nothing more than a temporary blip.
For example data from Safaricom paints a different picture. Safaricom controls 99% of the mobile money market, with much of its revenue coming from online gambling. The company has been clear that betting transactions are up, and not down as is otherwise suggested.
Using Technology Wisely
Meanwhile Kenyatta student Bwire is taking matters into his own hands. He recently launched an app that actively blocks gambling sites on mobile devices. He says that the adoption rate of the app is slow, but that he is still happy that the software is changing lives. He is also quick to praise Safaricom. The company released a smart mobile system that prevents college tuition from being diverted to betting apps.
Whatever the challenges there are solutions. It is clear that betting is in Kenya to stay, hopes are that the industry remains as much a benefit as it is potentially harmful. Africa as a whole will watch how the country handles an ever-evolving situation.