Connect with us


Gamble gone bad for Pambazuka lottery?

Some analysts point to low take-up of tickets as the main reason, with most Kenyans prefering sports betting



The lottery closed after the national draw on the night of Sunday 7th January 2018 at 7.30pm.

In gambling, being a game of chance, it’s mostly the players who find themselves holding the short end of the stick. Yet in one of those rare stories of this game of chance eating its own mother, a national lottery has had to bite the dust and close shop.

The Pambazuka National Lottery (PNL) on 7th January 2018 suspended operations in Kenya, citing a punitive taxation regime that came into effect this year, but some analysts point to low take-up of tickets as the main reason, as most Kenyans prefer sports betting which has been earning millions for winners, including old women in villages.

According to Pambazuka lottery management, prior to January 2018, operations had been based on a 55% pay-out and the imposition of a 25% tax devoted to charity as per regulations. The effect of the 35% tax on all tickets sales from 1st January, they said in the closure announcement, is that the total cost of operation rises to 115%.

“This is before the deduction of all operational costs,” the statement said. “Operating any lottery under this framework is not possible and therefore business operations are forced to close.”

> An expert explains how to make sure bets
> Top betting companies in Kenya you must know

The lottery closed after the national draw on the night of Sunday 7th January 2018 at 7.30pm, “until a sustainable regulatory framework is in place for the lottery industry.”

The lottery, owned by Bradley Ltd, was launched in July 2016 at a colourful ceremony beamed live on NTV. Speaking at the launch, Mr Hussein Mohamed, CEO Bradley Ltd, described the PNL as a “never-been-seen before brand in the market.” After facing the hard reality on the ground – a conspiracy of tax and stiff competition for people’s wallets from the likes of SportPesa and Betway –Mr Mohamed would find these words a little bitter to swallow.

Pambazuka-National-Lottery-winner Gamble gone bad for Pambazuka lottery?

One of the lucky winners in the Pambazuka National Lottery gets his prize.

Its model of “providing revenue-generating entertainment through the sales of an innovative product that will generate both social and economic benefits to Kenya”, sounded funky and was well hyped. The launch, for instance, was a masterpiece with a lineup of artistes both local and international, including Tanzania’s King Kiba, Uganda’s Radio and Weasel, STL, Redsan among other local acts.

ALSO READ: The 31-year-old Kenyan who makes Sh20 million in  bad month

The management said Pambazuka National Lottery said all prize claims after the 7th January 2018 draw will be paid out to winners directly or from the company offices until 7th April 2018.

Others are bullish

Even as Mohamed and his team lick their wounds, sport betting companies are donning a brave face, arguing that higher taxation would not ruin their game. Betway Country manager Wanja Gikonyo said gambling firms and the government would hold talks and reach an amicable solution. The companies have protested against higher taxation of 35 per cent of their profits.

SportPesa withdrew its sponsorship of local sports teams in protest and others have threatened to pull out. SportPesa CEO Ronaldo Karauri, on January 2, said getting out of sponsorships would save the company about Ksh600 million.

“The tax issue is a concern for Betway and the industry at large,” Ms Gikonyo said. “We are in talks … we will see how things will turn out.”

SEE: Four popular drinking joints face closure

Business Today is the leading independent online business website in Kenya. Started in 2012 by a veteran business journalist, it has a huge following both in Kenya and abroad. It covers various business and related issues. Email editor at: [email protected]

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

News Updates

Economy21 mins ago

Govt to merge six financial agencies to form mega bank

According to the plan, the new agency will become a one-stop shop for loans from the Government ranging

Politics59 mins ago

Win for MCAs in fight for fat pay

They claim the salary capping has negatively affected the effective functioning of the 47 County Assemblies and County Governments

Opinion7 hours ago

Align Kenya’s political system with global standards

There is need to ensure that our system is in line with international best practice especially as they relate to...

NEWS8 hours ago

Kitui County embroiled in models ‘sex scandal’

At least 16 models have dismissed the crowning of four winners at a beauty pageant held last month

NEWS8 hours ago

Kenya not yet fully a free democracy, new report says

While a full report on the country's performance is not yet available online, a summary of the report notes that...

NEWS10 hours ago

Family of five perishes in Juja inferno

Police said a woman, three children - all aged below 10 years, and a man were found early Tuesday morning

NEWS10 hours ago

Americans urged to support conservation

Conservation of nature in many countries in Africa contributes significantly to sustainable rural community livelihoods

NEWS1 day ago

It’s business as usual, Mike Sonko says

He dismissed reports that Igathe called it quits last Friday following disagreements arising from implementation of key projects and award...

NEWS1 day ago

Police mum on theft of State House furniture

Nakuru OCPD Samuel Obara told the press that only police headquarters in Nairobi or State House spokesman Manoah Esipisu can...

NEWS1 day ago

Uncertain future for 100 police officers recalled from NTSA

The Director of Personnel at Vigilance House, the Kenya Police Service nerve centre, Boniface Maingi asked the commanders to send...