Why Regulation Matters — Now More Than Ever

H2 identifies five core reasons why African governments must act:

  1. Consumer Protection: Without enforceable licensing requirements, players are exposed to fraud, identity theft, and unregulated game mechanics.
  2. Crime Prevention: Digital gambling can be used to launder money or facilitate underage betting — risks that only regulated frameworks can mitigate.
  3. Fiscal Opportunity: Licensed operators generate taxable revenue, but only when the system incentivizes them to stay in the market.
  4. Digital Innovation: A fair regulatory system encourages the growth of homegrown tech platforms, payment processors, and compliance tools.
  5. Cross-Border Consistency: Harmonized standards help curb illegal cross-border activity and allow for better data sharing and law enforcement cooperation

What Happens Without Regulation?

When there’s no incentive to operate onshore — due to uncompetitive tax regimes, licensing bottlenecks, or monopolistic structures — the industry moves offshore. H2’s data shows that unregulated offshore operators can capture up to 75% of GGR in poorly regulated markets.

This means:

– Local players are not protected.

– Governments collect minimal or no tax.

– Local entrepreneurs and developers are excluded from market opportunities.

– Illegal actors gain a competitive edge.

The Path Forward: Competitive Regulation

H2 recommends the following elements for a functioning regulated market:

– Open licensing: Allow multiple operators to apply, under transparent and non-discriminatory conditions.

– Digital-first oversight: Recognize the mobile nature of the market and adapt rules accordingly.

– Payment flexibility: Avoid forcing operators into single-payment integrations or exclusive monopolies.

– Tax simplicity: Ensure total fiscal burden (GGR tax + levies + monitoring fees) remains commercially viable.

If these conditions are met, H2 forecasts that Africa’s online gambling market could grow to $22 billion in annual GGR by 2029, with 90% of that revenue remaining in licensed, onshore markets.

The message is clear: regulating online gambling is not a matter of if — but how well.

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