The provinces hitting the jackpot thanks to online gambling loophole
Online gambling has grown massively in South Africa and, apart from the platform owners themselves, the biggest winners appear to be the provincial regulators they are registered with.
Online gambling - Pexels/Chris F
CapeTalk's Lester Kiewit speaks to financial journalist Larry Claasen about how the gambling landscape has shifted over the last two decades.
Listen below:
With the exception of sports betting, online gambling remains illegal in South Africa.
So how is it that the Mpumalanga provincial government has managed to hit the jackpot when it comes to coining online gaming revenue?
R759m in its 2023/2024 budget.
In his recent piece for the Financial Mail journalist Larry Claasen explores how online gambling companies have been able to set up new platforms and operate legally in South Africa.
And not only that, but also how they are registered with either the Mpumalanga Economic Regulator or the Western Cape Gambling and Racing Board when they operate nationally?
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"The National Gambling Act doesn't explicity outlaw online gambling, but it doesn't make provision for online gambling."
Larry Claasen, financial journalist
Claasen explains that provinces are taking advantage of a 'lottery loophole':
"You and I can't run a lottery, but we are allowed to make bets on the outcome of a lottery."
Larry Claasen, financial journalist
"And they moved that from lotteries to all kinds of other games...so it's slot games, table casino game, roulette games, so that's the key in making online gambling games licensed."
Larry Claasen, financial journalist
But is it legal?
That's a matter for the courts to decide says Claasen.
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Every game that you see on your phone has a licence, says Claasen.
The cost of that licence is R15 000.
"The provinces are now in competition with each other to issue these licences."
Larry Claasen, financial journalist
"Should we have revenue targets for gambling? Because that creates a moral hazard."
Larry Claasen, financial journalist
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Scroll to the top of the article to listen to the interview, and click here to read Claasen's article