South Africa’s online gambling market is facing a significant threat from unlicensed operators, with a staggering 62% of all online gambling activity now taking place outside of the regulated system. According to a report commissioned by the South African Bookmakers Association (SABA), this has resulted in an estimated R50 billion in gross gambling revenue being diverted offshore each year.
The report, which was conducted by YieldSec, found that approximately 16 million South Africans engaged with illegal online gambling platforms over the past year. This has raised concerns about the potential risks faced by consumers, including the possibility that winnings may not be paid out or could be forfeited to the state.
Regulatory Gap
The SABA has warned that the current regulatory framework is not doing enough to address the issue of unlicensed operators. “While the positive impact of re-channelisation away from the illegal market is acknowledged and supported by SABA, not enough is being done to address this area of the illicit economy,” said SABA CEO Sean Coleman. The National Gambling Act makes it unlawful to offer or participate in gambling services in South Africa without a valid local licence, but offshore operators continue to target local users, often presenting licences from jurisdictions such as Curaçao, Malta, Gibraltar, and the Philippines, which have no legal standing in South Africa.
Risks to Consumers
Consumers who use unlicensed platforms face significant risks, including the possibility that winnings may not be paid out or could be forfeited to the state. Participants may also face prosecution. “Many consumers are unaware that using these sites is not only risky but unlawful,” Coleman said. “There is no guarantee that winnings will be paid out, and players have no recourse if they are defrauded or exploited.”
The SABA is working with regulators, law enforcement, and the banking sector to strengthen enforcement and curb the growth of illegal gambling. The association has urged consumers to verify that operators are licensed locally and display valid South African regulatory details, including their registered entity name and relevant provincial gambling authority.
- Check if the operator is licensed in South Africa
- Verify the operator’s registered entity name and provincial gambling authority
- Be aware of the risks associated with using unlicensed platforms
By choosing a licensed operator, consumers can protect themselves from the risks associated with unlicensed platforms. As Coleman said, “Choosing a licensed operator is about protecting yourself. If the operator is not licensed in South Africa, they are operating outside of the law.”
