Africa May Become one of The Largest iGaming Markets – and Nigeria is a Key Part of It
The African gaming market has the potential to become one of the largest in the world.
Over the past five years, the number of gamers on the continent has doubled, according to Dutch research company Newzoo. This year, for the first time, Africa’s gaming industry is expected to surpass the $1 billion mark. This impressive growth is driven by several key factors: a youthful and rapidly growing population, improved internet access, and the widespread availability of affordable smartphones. Here’s why you should pay attention to this market in the upcoming years.
Africa is home to one of the youngest populations in the world. By 2050, the number of young people aged 0-24 is projected to increase by around 50%, according to the United Nations. This demographic shift is pivotal, as young people are the most avid gamers, fueling the growth of the iGaming market.
Another important factor is that internet access and mobile phone usage have seen dramatic increases in Africa. Mobile phone users rose to 272 million in 2019 and are expected to reach 475 million by 2025. North Africa also boasts significant mobile phone usage, with 290 million people owning cell phones. This rise in connectivity, particularly with the advent of 4G and 5G networks, is a significant driver of the gaming industry’s expansion.
This, coupled with the enhancement of mobile technology has been a game-changer in the continent. The introduction of gaming smartphones and advanced chips has made high-quality gaming accessible to many. Companies like MediaTek are at the forefront, launching premium gaming chips and collaborating with smartphone brands like Oppo, Xiaomi, and Infinix to bring feature-rich gaming devices to the African market.
Challenges and Gambling in Africa
Despite the growth, paying for subscriptions and in-game purchases remains a hurdle. Credit card penetration in Africa is a mere 2.7%, limiting access to traditional payment platforms like Google Play and Apple Store. Lucy Hoffman, co-founder and COO of Cape Town-based video game publisher Carry1st, highlights the issue: “A lot of our players just can’t buy the content they want. A big focus for us has been bridging the gap.”
The best way to overcome the challenge is by integrating with local payment methods. For instance, in Nigeria, gamers can use OPay, a mobile wallet, or bank transfers to purchase game content. This innovation makes gaming more accessible and prevents young gamers from running up large bills, as pointed out by gamers like Shakeel Kajee from Cape Town. However, it can be limiting for foreign online casinos trying to operate in Africa or native ones eager to promote mobile games.
At the same time, the gambling market in Africa is witnessing rapid growth. A study by RandM projects a compound annual growth rate of 12% for the African gambling sector from 2020 to 2025, with the market expected to surpass $40 billion by 2025. Although popular online games like FIFA and PUBG are famous throughout the continent, there are great expectations regarding casino development.
Nigeria holds a significant position in this landscape, boasting the second-largest gambling market in Africa. According to an article on casino maturity in Africa published by The Guardian, Nigeria’s gambling market is valued at $2 billion annually, just behind South Africa’s market worth $2.1 billion. The proliferation of smartphones and tablets, alongside with the youthful population has made mobile gaming particularly popular.
Regarding the gaming population and ideal development scenario, Nigeria possesses all the essential criteria for growth. Research by KTO casino online, one of Brazil’s largest platforms, indicates that the average age of casino players and bettors is approximately 39.2 years, with most players aged between 25 and 40. More than half of these players reside in urban areas, where internet access and mobile phone usage are prevalent, indicating similar demographics with a market that is likely to become the third largest in the world.
Glenn Gillis, CEO of Cape Town-based game developer Sea Monster Entertainment, believes the future of gaming is bright in Africa. “You know, those markets (Europe and the U.S.) are mature. They’re aging, and there’s not a lot of growth there. Whereas all the exciting things really are happening across the continent,” he said.
Africa’s gaming market is set for exponential growth, with predictions indicating the market size will reach USD 3.72 billion by 2029. As for casino gaming and sports betting, Nigeria is the second biggest country in the continent, with more than 78% of its adult population taking part in these activities. While challenges like payment methods and regulatory issues remain, the African gaming market is on an upward trajectory. With Nigeria at the forefront, the continent is set to become a significant player in the global gaming industry.
