bet9ja.com
By Alexis Akwagyiram and Didi Akinyelure

LAGOS, June 25 (Reuters) - Online sports betting is booming in soccer-mad Nigeria mostly thanks to payment systems established by homegrown innovation firms that are starting to make online organizations more viable.

For several years, mobile payments failed to take off in Nigeria as they have in countries such as Kenya, where Safaricom’s M-Pesa cash transfers have actually cultivated a culture of cashless payments.

Fear of electronic scams and slow internet speeds have held Nigerian online consumers back however sports betting companies says the new, fast digital payment systems underpinning their websites are changing mindsets towards online deals.
bit.ly
“We have seen substantial development in the number of payment solutions that are offered. All that is certainly altering the video gaming space,” stated Seun Anibaba, CEO of Lagos State Lotteries Board, video gaming regulator in Nigeria’s industrial capital.

“The operators will go with whoever is quicker, whoever can link to their platform with less problems and glitches,” he stated, adding that taxes from sports betting wagering in Lagos State rose 30 percent to 40 percent in 2017 from 2016.

That development has actually been matched by an increase in web payments, according to data from the Nigeria Inter-Bank Settlement System (NIBSS), which is owned by the reserve bank and licensed banks.

In 2016, there were 14 million web payments worth an overall 132 billion naira ($420 million). Transactions jumped to 29 million worth 185 billion in 2017 and in the very first quarter of 2018 there were almost 10 million worth 61 billion.

With a young population of nearly 190 million, rising cellphone usage and falling information expenses, Nigeria has actually long been seen as a fantastic chance for online services - once consumers feel comfy with electronic payments.

Online sports betting companies say that is occurring, though reaching the 10s of countless Nigerians without access to banking services stays a challenge for pure online retailers.

British online wagering firm Betway opened its first in Kenya in 2015, followed by Uganda, Ghana and South Africa. It launched in Nigeria in January.

“There is a progressive shift to online now, that is where the market is going,” Betway’s Nigeria manager Lere Awokoya said.

“The growth in the number of fintechs, and the federal government as an enabler, has assisted business to thrive. These technological shifts encouraged Betway to start running in Nigeria,” he said.

FINTECH COMPETITION
bit.ly
sports betting firms cashing in on the soccer craze worked up by Nigeria’s participation on the planet Cup state they are discovering the payment systems created by local startups such as Paystack are proving popular online.

Paystack and another regional start-up Flutterwave, both established in 2016, are offering competition for Nigeria’s Interswitch which was set up in 2002 and was the main platform utilized by services operating in Nigeria.

“We included Paystack as one of our payment alternatives with no fanfare, without revealing to our consumers, and within a month it soared to the primary most pre-owned payment alternative on the site,” said Akin Alabi, creator of NairabBET.

He said NairaBET, the nation’s 2nd greatest sports betting company, now had 2 million routine consumers on its site, up from 500,000 in 2013, and Paystack remained the most popular payment option since it was included late 2017.
bet9ja.com
Paystack was established by 2 Nigerian computer technology graduates, Shola Akinlade and Ezra Olubi, who received early stage funding in Silicon Valley’s Y-Combinator programme.

In December 2016, it raised $1.3 million from investors including China’s Tencent and Comcast Ventures in the United States.

Paystack, based in the frenetic Ikeja district of Lagos, said the variety of monthly transactions it processed rose from about 8,000 in early 2016 to more than 900,000 since June 2018.

“In early 2016 we were processing about $3,000 a month. Today we process well over $11 million every month,” stated Emmanuel Quartey, Paystack’s head of growth.

He said an ecosystem of developers had emerged around Paystack, developing software application to integrate the platform into websites. “We have seen a growth because community and they have actually carried us along,” said Quartey.

Paystack said it makes it possible for payments for a variety of sports betting companies however likewise a wide variety of services, from energy services to transport companies to insurer Axa Mansard.

Flutterwave, co-founded by Nigerian business owner Iyinoluwa Aboyeji, is likewise backed by the Y-Combinator program along with venture capitalists Greycroft Partners and Green Visor Capital and the Omidyar Network. It raised $10 million last year.

FOREIGN INVESTMENT

Shifts in Nigeria’s payment culture have actually coincided with the arrival of foreign investors wanting to use sports betting wagering.

Industry professionals say the sector creates about $1 billion a year and is likely to grow faster than in South Africa and Kenya where business is more developed.

Russia’s 1XBet and Slovakia’s DOXXbet have both set up in Nigeria in the last 2 years while Italy’s Goldbet was ahead of the pattern, taking a half stake in market leader Bet9ja when the Nigerian company introduced in 2015.

NairaBET’s Alabi stated its sales were split between stores and online however the ease of electronic payments, expense of running shops and ability for customers to prevent the preconception of gaming in public implied online deals would grow.

But despite advances in digital payments, Kunle Soname - chairman and co-founder of Bet9ja - stated it was important to have a store network, not least due to the fact that lots of consumers still stay unwilling to invest online.

He stated the company, with about 60 percent of Nigeria’s sports betting market, had an extensive network. Nigerian sports betting stores often act as social hubs where clients can enjoy soccer totally free of charge while positioning bets.

At a BetKing hall deep inside the bustling Oshodi market in Lagos, lots of soccer fans gathered to view Nigeria’s last warm up game before the World Cup.

Richard Onuka, a factory worker who earns 25,000 naira a month, was fixated on a TV screen inside. He stated he started sports betting three months back and bets as much as 1,000 naira a day.

“Since I have actually been playing I have actually not won anything but I think that a person day I will win,” said Onuka. ($1 = 314.5000 naira) (Reporting by Alexis Akwagyiram and Didi Akinyelure in Lagos