bet9ja.com
By Alexis Akwagyiram and Didi Akinyelure
bet9ja.com
LAGOS, June 25 (Reuters) - Online sports betting is booming in soccer-mad Nigeria mainly thanks to payment systems established by homegrown innovation companies that are starting to make online companies more feasible.

For 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 fostered a culture of cashless payments.

Fear of electronic fraud and slow internet speeds have actually held Nigerian online customers back but wagering firms states the new, quick digital payment systems underpinning their sites are altering attitudes towards online deals.

“We have seen substantial development in the variety of payment solutions that are offered. All that is definitely altering the video gaming area,” stated Seun Anibaba, CEO of Lagos State Lotteries Board, video gaming regulator in Nigeria’s commercial capital.

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

That development has actually been matched by an increase in web payments, according to information from the Nigeria Inter-Bank Settlement System (NIBSS), which is owned by the main 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 nearly 10 million worth 61 billion.

With a young population of nearly 190 million, rising mobile phone use and falling information costs, Nigeria has actually long been viewed as a terrific opportunity for online companies - once customers feel comfortable with electronic payments.

Online gambling 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 company Betway opened its very first African service 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 supervisor Lere Awokoya said.

“The growth in the number of fintechs, and the government as an enabler, has assisted business to grow. These technological shifts motivated Betway to begin operating in Nigeria,” he said.

FINTECH COMPETITION

sports betting firms cashing in on the soccer craze worked up by Nigeria’s involvement worldwide Cup state they are discovering the payment systems developed by regional start-ups such as Paystack are showing popular online.

Paystack and another local startup Flutterwave, both founded in 2016, are supplying competitors for Nigeria’s Interswitch which was established in 2002 and was the utilized by companies running in Nigeria.

“We added Paystack as one of our payment choices without any excitement, without announcing to our clients, and within a month it shot up to the number one most secondhand payment choice on the website,” said Akin Alabi, creator of NairabBET.

He said NairaBET, the country’s 2nd biggest sports betting company, now had 2 million regular customers on its site, up from 500,000 in 2013, and Paystack remained the most popular payment alternative since it was added in late 2017.
bet9ja.com
Paystack was established by 2 Nigerian computer science graduates, Shola Akinlade and Ezra Olubi, who received early stage financing in Silicon Valley’s Y-Combinator programme.

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

Paystack, based in the mad Ikeja district of Lagos, said the variety of month-to-month transactions it processed increased from about 8,000 in early 2016 to more than 900,000 as of June 2018.

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

He said an environment of designers had emerged around Paystack, producing software application to incorporate the platform into websites. “We have seen a growth in that community and they have brought us along,” said Quartey.

Paystack stated it allows payments for a number of sports betting companies but also a wide variety of services, from energy services to transport business to insurance provider Axa Mansard.

Flutterwave, co-founded by Nigerian entrepreneur Iyinoluwa Aboyeji, is likewise backed by the Y-Combinator program in addition to endeavor 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 coincided with the arrival of foreign financiers hoping to take advantage of sports betting wagering.

Industry professionals state the sector produces about $1 billion a year and is most likely to grow faster than in South Africa and Kenya where business is more established.

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

NairaBET’s Alabi said its sales were split between stores and online however the ease of electronic payments, cost of running shops and ability for clients to avoid the stigma of gaming in public meant online transactions would grow.

But in spite of advances in digital payments, Kunle Soname - chairman and co-founder of Bet9ja - stated it was essential to have a shop network, not least since numerous customers still stay hesitant to spend online.

He stated the company, with about 60 percent of Nigeria’s sports betting market, had a comprehensive network. Nigerian sports betting shops frequently function as social hubs where consumers can view soccer free of charge while positioning bets.
bet9ja.com
At a BetKing hall deep inside the busy Oshodi market in Lagos, lots of soccer fans gathered to see Nigeria’s last warm up video game before the World Cup.
bet9ja.com
Richard Onuka, a factory worker who earns 25,000 naira a month, was fixated on a television screen inside. He stated he started gambling 3 months back and bets as much as 1,000 naira a day.

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