MTN Nigeria and Airtel Africa have been granted a payment service bank (PSB) license by the Central Bank of Nigeria (CBN) in order to provide mobile money services.
This represents a tremendous opportunity for the Nigerian gaming industry, which has progressed from being an underground industry to a mainstream business, with the sector now estimated to be worth billions of dollars. Fintech, bank cards, ATMs, and bank USSD Short Code payment have all played a significant role in this exponential growth, and have become the preferred method of payment for bettors over the years. In essence, this payment method has been judiciously used by online sports betting casinos, and loker sites.
The success of mobile money in sub-Saharan Africa has had an impact on the rise in online betting and gambling,
particularly in the East African region, where it has become the preferred method for sports betting enthusiasts to deposit and receive payment from their favorite bookmaker, thanks to technology that assists the gambling and betting industry by providing convenience, flexibility, and low fees.
This is obvious in the African gaming market, notably in mobile internet betting and gambling, which is transforming the sector in East Africa and beyond. It has helped firms in a variety of industries restructure and achieve massive turnover. For all practical purposes, the gaming business is the obvious area through which online betting and gambling have witnessed exponential development in the previous few of years. According to a recent research in Kenya, a total of Sh83.2 billion was spent on gambling through M-Pesa in the six-month period from April to September 2021. This is a clear demonstration of the importance of mobile money. It has the potential to increase the income of sports betting organizations, as well as to broaden financial inclusion and revolutionize all industries that have embraced digital transformation. According to the Economic and Financial Inclusion Agency (EFInA), statistics reveals that just 64.1% of Nigerians were financially included by the end of last year.
This implies that 38.1 million of the country’s 106 million individuals (18 years and older) are completely shut out.
A big potential market exists in Nigeria, and gaming businesses in the nation may benefit from exploring it further. It is, without a doubt, a massive market for gambling operators, eCommerce, logistics, health, and a variety of other businesses. Nigeria’s central bank has decided to issue PSB licences to the country’s two largest telecoms companies, which is in accordance with the bank’s goals of increasing financial inclusion and growth of the payment system via the use of a secure technology-driven environment.
However, as indicated in the article, this new initiative is planned and poised to cause significant upheaval in Nigeria while also facilitating financial inclusion among the rural and disadvantaged people. As a result of the pending mobile money licenses for MTN and Airtel, an estimated 38 million individuals, the majority of whom live in hard-to-reach rural regions, are projected to gain access to financial services by 2020. Allowing telecommunications companies to provide financial services ensures that rural residents will have access to necessary financial help. In accordance with the recommendations, mobile network providers are granted permission to offer financial services to millions of Nigerians who are currently without access to formal financial institutions. However, they may only do so as public-sector bodies and via a subsidiary that is independent from their primary business. Thus, MTN and Airtel will provide PSB services via their respective subsidiary companies, MTN MoMo and Airtel Smartcash respectively.
However, one of the most important goals of the PSB initiative was to increase financial inclusion by increasing access to deposit, payment,
and remittance services for small businesses, credit card holders, low-income households, and other financial excluded entities through high-volume, low-value transactions in a secure, technology-driven environment, which was achieved through the establishment of PSBs. Some financial inclusion objectives are more likely to be met via the employment of these methods, as seen by the success of the mobile money-led financial inclusion model in Kenya, Ghana, Rwanda, and other countries that have taken this model on board. In Kenya, mobile technology is responsible for the majority of the country’s unbanked population; the country’s financial inclusion rate has increased from a low of 26.7 per cent a decade ago to 83 per cent by 2020. East African countries such as Kenya, Tanzania, and Uganda are now among the world’s leaders in mobile money services, with 102 million users worldwide, 56 million in West Africa, and 20 million in Central Africa. Safaricom, a telecommunications company, was the first to provide M-Pesa services, which were launched 12 years ago to serve Kenyans who did not have access to conventional banking. It is obvious in a certain location that mobile money is a success story when it comes to increasing financial inclusion.
It’s possible that Nigeria would be late to the party, given the Central Bank just officially approved the provision of financial services
by telecommunications and other non-financial enterprises in 2018. While hardly a game changer, the recent pre-approval for mobile money service in Africa’s most populous nation is a significant step forward and a positive move for casino operators that are purely concerned with digitalizing their business processes.