International edition
June 21, 2021

By Ron Mendelson, Fast Offshore Founding Partner

The online gambling sector’s most interesting emerging markets

The online gambling sector’s most interesting emerging markets
Ron Mendelson says that regionally, growth is around 20% year on year in LatAm, driven by smartphone usage and a preference for mobile gambling. Its expected revenue will surpass $7billion by the end of 2021.
Costa Rica | 06/09/2021

The expert consultant for the igaming industry shares key insights and outlooks about Latin America, India and Africa's online gambling markets.

Ron Mendelson is the Director of Costa-Rica based International Business & Corporate Services consultancy firm, Fast Offshore. With ... (+ Info)

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t’s old news that the online gambling sector is booming. We know that APAC is the largest market in the world, followed by Europe. We also know that the US is mulling laws and regulations on a state-by-state basis, making it hard for operators to get started. But what do we know about emerging markets? Several exciting regions offer a wealth of opportunities, if not right now, shortly.

Latin America

Latin America has been described as “a land of promise” for online gambling operators. While only a handful of countries have legalized and regulated the sector, they are already witnessing stable growth. Those that haven’t yet taken the plunge are expected to do so in the coming years. A generally untapped market, the potential is immense for sportsbooks, casinos, and other forms of betting. Some countries like Brazil and Ecuador have a blanket ban on gambling, whereas many others just haven’t included iGaming in regulations, making it de facto legal.

Currently, Brazil, Mexico, and Bolivia are mulling reforms on gambling laws which will see changes expected in the future. In particular, sleeping giant Brazil holds significant potential for the future. It remains the biggest and most populous country in the region, with more than 211 million residents. Colombia is also working on revamping regulatory frameworks to support the growth of the digital economy. In Nicaragua and Bolivia, online gambling is included in national gambling legislation, while in Argentina, it’s decided by each province.

In April of this year, the Argentinian province of Buenos Aires legalized online gambling. Home to the capital of the country, it set forth provisions for licensing and issued a number to various operators. There is huge potential for the Argentinian market, particularly if other provinces follow suit.

Regionally, growth is around 20% year on year, driven by smartphone usage and a preference for mobile gambling. Its expected revenue will surpass $7billion by the end of 2021.

India

India may not be a continent or region, but it’s home to 1.366 billion people. This makes it a country of interest for those considering emerging online gambling markets. The market has been on the up for several years, growing at an estimated 40% CAGR rate every year. It’s estimated the market value could surpass $2.8 billion by 2022.

Indian consumers love technology and smartphones. They also love to play games and gamble with their mobiles. The freemium model is also popular across the country, as well as live dealer casinos. When combined with an increase in the per capita income and better access to internet infrastructure, a perfect storm is created.

There are big expectations for the Indian sector over the coming years, particularly in conjunction with mobile payments, virtual reality, and blockchain-based gambling options. 

In terms of regulation, online gambling is allowed throughout most provinces and states. Some, however, do not have any legislation in place, so it’s allowed only due to the lack of laws. Each state is allowed to make its laws relating to games of chance and games of skill. There is a lack of legal land-based betting, so many gamblers prefer to opt for professional online alternatives.

India remains one of the most widely anticipated markets in terms of development and growth. All it needs is more legal certainty and clarity for it to reach its full potential.

Africa

The African continent is home to over 1.34 billion people as of 2020. It is also the world’s poorest continent with a widespread lack of access to the internet and technology. That said, several markets within Africa are to cover all bases.

Regulations and laws for gambling vary significantly throughout Africa, due in part to laws that also relate to religion. Conventionally Muslim countries tend to have stricter laws, whereas Christian, or others, do not. Many countries have no laws on gambling, leaving a ‘grey area’ which is likely to be addressed in the future. For example, in Ghana, online gambling isn’t mentioned in the relevant gambling laws due to a lack of oversight. While this may de facto allow online gambling, it could be regulated in the future.

Both Uganda and Kenya are so-called “hotspot countries” where there is supportive legislation for online gambling. Laws seek to both protect players and operators while creating a new stream of revenue for the state.

So, what now?

If you’re a gambling operator looking to set up in an emerging market, it’s wise to tread carefully. As you can see, laws are not always clear cut, and they can be prone to quick changes. It’s always necessary to engage a corporate service provider with significant experience in gambling, to help you navigate the waters. Rather than seeking to license in one of these jurisdictions, it can be a smart move to look for a gaming license elsewhere that gives you the chance to offer your services there. Either way, run it past your provider first to make sure you’re operating legally.

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