From recreation to survival: Since the Covid-19 pandemic, sports betting and online gambling have outpaced traditional casino gambling, driven by the growing accessibility of online platforms. Photo: Supplied
For many South Africans, online gambling has become a way out of poverty, prompting a surge that has left policymakers worried about the damage to livelihoods and leading to calls for stricter regulations around advertising in the industry.
Since the Covid-19 pandemic, sports betting and online gambling have outpaced traditional casino gambling, driven by the growing accessibility of online platforms.
It was initially primarily a recreational activity, but it has quickly become a means for economic survival.
Beneficiaries of government social grants and even some tertiary students funded through the National Student Financial Aid Scheme are using their allowances for online gambling and betting, research suggests.
“Some of our studies are suggesting that youth is gambling quite a lot, and there’s a certain age that we’re actually observing where they are actually gambling,” acting chief executive of the National Gambling Board, Lungile Dukwana, said.
“It is a concern for us, and we are investing in education with some tertiary institutions.”
Gross gambling revenue rose 25.7% to R59.3 billion during the 2023-2024 financial year, with betting contributing 60.5% with R35.9 billion, according to research published by the board last month.
Casinos generated 29.3% with R17.4 billion, while limited payout machines brought in 7% with R4.1 billion and bingo brought in 3.2% with R1.9 billion.
Betting saw the strongest growth at 51.2%, while casinos and bingo recorded minimal gains and limited payout machine revenue declined, the research showed.
The board said R1.1 trillion was wagered across the industry during the period, a 40% increase.
Approximately 14 000 formal jobs were created in the sector, with spillovers into advertising, telecommunications, and information technology services, according to Anchor Capital economist Casey Sprakes.
“These gains come with critical caveats. The same digital accessibility driving growth is also amplifying social risks, particularly as a source of financial strain among vulnerable groups such as the youth and low-income households,” she said.
“In effect, gambling has become both a revenue generator and an extractor, circulating vast sums within the economy but often at the expense of household financial stability,” Sprakes said.
“As such, this transformation is not just a consumer story; it represents a significant redistribution of discretionary spending within the local economy. What was once spent on entertainment, travel, or leisure is increasingly being channelled into betting platforms, both domestic and offshore.”
Policymakers and others have recommended that the department of trade, industry and competition implement reforms, beginning with stricter regulation of gambling advertising.
Political party Rise Mzansi proposed a seven-point plan that includes limiting advertising hours, raising provincial gambling taxes to at least 8%, compelling gambling operators to allocate 40% of their marketing spend to promoting responsible gambling, and imposing strict controls on influencer marketing and sport sponsorships.
“Our seven-point plan, the first one is to deal with the advertising — to moderate the exposure of gambling advertising,” Rise Mzansi chief organiser Makashule Gana told the Mail & Guardian.
“There’s an acceptance that the advertising has gone overboard. The messaging has gone overboard. It needs to be moderated,” said Gana.
“There is acceptance by players, by the operators themselves, that it needs to be moderated, so when operators themselves accept this, it tells me that the victory is in sight,” he said.
“We are going to see reforms only if we get the department of trade, industry and competition to convene the National Gambling Policy Council and get these regulations that don’t require a change of legislation out of the way,” said Gana.
“I accept that that will not be done overnight, but the ones on advertising, on getting the gambling operators moderating their messages, we can get them out in no time, and that’s why we are going to picket at the department of trade, industry and competition on Friday.”
The South African Responsible Gambling Foundation has also proposed amendments to the National Gambling Act to modernise regulation and strengthen consumer protection.
These include incorporating specific provisions for remote gambling, establishing comprehensive definitions that reflect contemporary forms of gaming and implementing targeted interventions to protect minors and address problem gaming as a recognised disorder, executive director Sibongile Simelane-Quntana told the M&G.
“These measures are essential to safeguard consumers, uphold transparency, and secure the economic sustainability of the gambling sector in South Africa for years to come,” Simelane-Quntana said.
The foundation also urged the trade department to adopt Norms and Standards as a supplementary legal instrument to the Act. “The current legislative regime, as established by the National Gambling Act, has not kept pace with technological advancements and the evolving nature of gambling, particularly in the digital sphere,” Simelane-Quntana said.
“Norms and Standards provide a flexible and adaptive regulatory approach that can be updated more readily than primary legislation, allowing for a more responsive mechanism to address emerging risks and trends within the industry.”
Additionally, norms and standards can offer the potential for greater consistency in regulatory practices across the various provinces as well as enable the incorporation of international best practices and evolving global frameworks into the South African context without the need for frequent legislative amendments, Simelane-Quntana said.
The National Gambling Board is also working with government entities to deal with advertising. “We have engaged specifically with the Advertising Standards Board with the interest of coming up with what is called the advertising code, or regulation where we can be able to make sure that all of those that are licensed take responsibility in relation to advertising in the right places, in advertising where they are licenced, in making sure that they advertise where there are no kids, what are the unintended recipients of the messaging and they do not give misleading messages,” Dukwana said.
He said that the second issue was also illegal online gambling, where some international operators, not licensed in South Africa, find space online, leading to more money flowing out of the local economy.
Meanwhile, Sprakes said the industry must be kept in check to ensure its benefits, including economic contributions and jobs, are safeguarded.
“In the absence of more decisive policy intervention and financial literacy initiatives, the industry’s expansion risks entrenching a pattern of consumption-led liquidity extraction, rather than contributing to inclusive, long-term economic resilience,” Sprakes said.
“Sustainable returns will depend not just on market momentum, but on the sector’s ability to balance innovation with responsibility.”
The trade department had not responded to the M&G’s questions by the time of publishing.