How poverty and lack are funding Nigeria’s N5.6trn online gambling market

Online gambling activities in Nigeria have reached a significant level, with new reports revealing the market has surged to an estimated N5.6 trillion in value. 

While the surge shows the continuous growth of sports betting, casinos and gambling among Nigerians, it has raised serious concerns over the increased dependence of a large part of the Nigerian population on online gambling for survival. 

Firstly, amid poverty and economic hardship, a significant amount is being spent on online gambling. Secondly, the increase in smartphone usage, flexibility of digital payment and the struggle for daily survival, especially among Nigerian youth, are fueling the gambling market. 

According to Dr Emomotimi Agama, Director-General of the Securities and Exchange Commission, Nigeria (SEC), about 60 million Nigerians spend $5.5 million daily on gambling. This means that, at least, 1 in every 4 Nigerians engages in gambling. This also shows that a large part of the population prefers everyday risk-taking to the 3 million active Nigerians in the capital market. 

Another 2023 report corroborates the above submission. The report, by the National Lottery Trust Fund (NLTF), revealed that around 65 million Nigerians engage in regular betting activities, with an average daily expenditure of $15 per person. During that year, the agency noted that about 14 million bets and payments were made online in Nigeria every day. 

As online gambling offers instant returns and an alternative source of income, the market is projected to grow nearly 10% and reach more than $366 million by 2027.

The drivers 

Gambling is a larger term that includes both physical centres and online platforms where gamblers can stake using their smartphones. Commercial gambling encompasses many activities, including lotteries, number games, sports betting, horse betting, poker and other card games, casino table games, and electronic gaming machines

However, sports betting is popular in Nigeria due to the already-established grounds. Engaging in online gambling has become easier with the creation of an online account whose payments are linked to the owner’s bank account.

Online gambling activities are gaining prominence among Nigerian youths, picturing it as a fast means to escape poverty. While risks abound in the market, the convenience it brings is a contributing factor. Others include peer influence and the availability of experts who provide betting codes.

A betting hub

In their desperate state and survival mode, online gambling offers hope for quick riches with minimal initial capital or stake. For instance, using as low as N100 or N200 to a possible 6-digit win offers a life-changing opportunity and serves as a motivator. The fact that ample success stories exist is enough to keep the hopes of youths high and maintain consistency in the game.

However, with consistency comes addiction. Gamblers can be hell-bent on spending a higher proportion of their income on betting, which potentially leads to deeper poverty. As online gambling receives more funding, the addiction fuels more gambling behaviour. 

For Nigerian youths who want to keep up to expected standards, unemployment, underemployment, frequent financial hardship and social marginalisation can create emotional tension and psychological distress. To some, gambling can be used as a temporary escape or a coping mechanism to alleviate stress and despair, further fueling the behaviour. 

To some extent, online gambling has become a side hustle, an alternative source of income and what many youths consider a means of escaping poverty. The fact that the market offers quick returns despite its risky nature, is easily accessible and requires limited expert guidance, is fueling its adoption among Nigerians, especially youths. 

Also Read: See full list of legal and illegal gambling platforms in Lagos State.

The mixed bag

On a positive note, the gambling industry creates jobs, generates revenue for the Nigerian government, and offers investment opportunities for market stakeholders. While internet penetration is a leading factor in its surge, the rate of commercialisation, marketing and rise in popularity are also factors. 

Meanwhile, rather than being a solution to poverty, online gambling tends to undermine the economic resilience of individuals and families, diverting funds from essential needs and perpetuating a cycle of debt and poverty.

Gambling (Image Credit: Rest of World)

Experts posit that people who gamble at harmful levels generate around 60% of losses and can threaten health, leading to increased incidents of mental illness and suicide. Other social issues include relationship breakdown, domestic violence, financial distress, and potential involvement in theft and fraud.

Online gambling can drive poverty by diverting household spending from essential goods and services. Also, the activity has been revealed as a common way to launder money obtained through illegal activities.

In some cases, it takes a serious therapy session or spiritual intervention to alleviate addiction to gambling.

The future 

Industry analysts estimate global gambling revenue will reach $700 billion by 2028, driven by smartphone use in low and middle-income countries. In Nigeria, the market is expected to reach N531 trillion ($366 million) by 2027.

As adoption rates are expected to skyrocket, experts acknowledge the need for stable regulation to rebuild public trust and attract long-term capital.

In Nigeria, for instance, the dispute over who regulates gambling activities remains unresolved. This follows the Supreme Court’s November 2024 verdict that nullified the National Lottery Act, ruling that gaming falls under state rather than federal jurisdiction. Amid the lack of clarity, a proposed Central Gaming Bill intended to harmonise licensing, taxation and standards has advanced through the National Assembly. 

The ongoing dispute had slowed efforts to regularise both online gambling and physical betting activities, thereby creating a hole in a market that’s witnessing rapid growth.

Also Read: Inside Nigeria’s online gambling boom and the fintech platforms powering it.