Current state of online gambling in Kenya
Mobile internet demand has gone up 35% as more customers stay home. Customers tap into the Internet to work from home, study from home and access social media and entertainment sites. [Photo/Business Today]

Few years ago, gambling was a preserve of the rich in Kenya and, occasionally, the most daring. Gamblers had casinos around main cities as the only viable gambling avenues. 

But the entry of the internet into the game collapsed the barriers, opening millions of Kenyans to the wonder world of gambling.

High growth in gambling has been fuelled by the growth of smartphone/internet penetration in Kenya, riding on sports betting which has become a craze. Over 90% of Kenyans today use their smartphones to get online, with a majority of them using them for online gambling.

Kenya is now one of the fastest growing online gambling markets in Africa, with the number of online casinos growing as well. On trusted websites like Kenyan players would find all the licensed operators for the country as well as all the information needed regarding their best offers.

 Kenyans play various online casino games including popular ones such as poker, roulette and blackjack, not to mention organized tournaments. Besides, there also live dealer games.

Kenyans play online slots that come in different shapes and styles including progressive jackpot online slots, movie-based slots, 5-reel slots and more.

The most popular online gambling in Kenya is found in sports betting. Kenyans love sports, especially football and are often placing bets on their favourite teams through various platforms – from the big cities like Nairobi to village shops in rural Kenya.

Many Kenyans – young and old, male and female – have won millions of shillings from sports betting. More millionaires have also been created through ubiquitous casinos across the country. These winnings are drawing more and more people into gambling and sports betting.

Online gambling, though, is having a negative impact on Kenya’s social fabric, with addiction becoming a common problem. The government of Kenya, also concerned that betting could turn young people into zombies, moved in to tighten regulation in an effort to counter addition by having gambling service providers invest part of their revenues in creating more awareness on gambling and other causes.

The emerging regulatory framework is geared at streamlining betting and expanding the gambling industry in Kenya with minimum disruptions to lives and the economy.

As with offline, online gambling is regulated by the Betting Control and Licensing Board (BCLB), which controls the gambling environment and approves operators who meet necessary requirements. Over the past years, more than 20 betting and gambling companies have been given licences to operate in Kenya.

Higher taxes on gambling

The reap more from this growing industry, the government has imposed more taxes on operators and players. In the latest revision operators tax was increased from 20% to 35%, which is still lower than the proposed 50%.

This forced some operators to exit the market, seeing this as an extra burden to the 35% corporate tax and contribution of 20%of their revenues to a worthy cause. Operators are supposed to withhold 20% of players’ winnings as part of this taxation policy.

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Betting firms contested the 20% tax demanded by the Kenya Revenue Authority (KRA) and early November the Tax Appeals Tribunal ruled that a punter’s stake in a bet cannot be charged the 20% tax on winnings. The Tribunal ruled that the 20% tax should be charged on the positive difference between the payout made and stakes placed in a given month.

Blocked betting sites

However, a few punters soon discovered a way to get around these regulations to place bets without having to pay the withholding tax using international betting sites.

The punters have been using debit cards to deposit stakes into the betting sites wallets before placing bets. Winnings are channeled back to their bank accounts. But the government discovered the loophole and blocked the sites in Kenya.

It did not take long before the Kenya Government identified the loophole and rendered the betting sites inaccessible in Kenya. This move is expected to hit the betting industry in Kenya, which is estimated at over Ksh200 billion per year and growing.

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