Gaming Sector
The Ace Up Nigeria’s Sleeve
NIGERIA
NEXT LEVEL
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Nigeria’s fast expanding gaming business is empowering its populous youth through technology, while partnerships with mobile money platforms game change Nigeria’s economy. Nigeria has one of the most successful gambling industries the world over, expanding quickly and widely over a short stretch of time with outstanding results. In 2018, for example, it generated US$180 million in revenue and greatly impacted the nation’s GDP through taxation, increasing employment and the provision of business opportunities. While earning an additional income is key to the boost in sports betting and lotteries in the nation, the increase in the less likely young middle-class Nigerian as customer base is undoubtedly the result of improved national internet penetration and accessibility, causing a proliferation of the industry, with people being able to bet within the comfort of their homes. The National Lottery Act 2005 defines lotteries to include any game of luck that involves drawing a lot for a prize and a strategy for fundraising. Since the National Lottery Regulatory Commission was established in 2005, it has issued licences and permits to lottery operators and promoters, growing the market by opening up opportunities for investors, individuals and the government. The three categories of licences are: lottery licence, sports betting licence and promotional lottery (promotional schemes with an element of chance or lot in the prize’s distribution, for example scratch cards or SMS/USSD). Through the investment and engagement in regulated lottery, the nation was provided with a new platform from which they could now contribute to national development. “Gaming provides employment and empowerment for the youth, who can be employed as agents or operators,” explains Lanre Gbajabiamila, Director General of the National Lottery Regulatory Commission. “At the same time, we make sure that gaming remains responsible. Gaming is ultimately entertainment: if you win, good;
if you don’t, you’re still contributing to good causes, which is something we manage through our sister agency, the National Lottery Cross Fund.” Nigerians are sports loving people, so it is hardly surprising that there has been a consistent increased preference for sports-related betting around the nation, causing it to become one of the most lucrative segments within the gaming sector. With the advent of the internet, online sports betting has been further boosted through a number of different betting platforms, whereby online sports betting operators have attained enormous gains through mobile payment, many of whom have since become millionaires. In June 2018, Seun Anibaba, CEO of Lagos State Lotteries Boards, reported to Reuters that sports betting sector growth had been matched by a rise in web payments according to data from the Nigeria Inter-Bank Settlement System (NIBSS), concluding that the online sports betting sector had a worth of approximately US$620 million in 2018. “The Nigerian lottery and gaming industry has grown and has gone technically digital, rather than retail,” states Gbajabiamila. “The only way to manage that aspect of the industry is collaborating with Nigerian Communications Commission (NCC), which makes us able to properly enforce regulations. We also collaborate with the Central Bank of Nigeria (CBN), the Nigerian Financial Intelligence Unit (NFIU) and other federal agencies, to enhance revenues for the country.” Global trends have demonstrated that sports betting, if clearly regulated, can be a major sector for the generation of tax revenue by the government. Nigeria’s successful evolution of its gaming sector has gained momentum under NLRC’s guidance, revealing that its potential as an alternative to oil in income generation is no game, but a truth rooted in reality.
