Market outcomes define Africa's gaming success: GCI President

Africa’s regulated online gambling market grew to $5.2 billion in 2025, but unregulated operators continued to dominate the sector, accounting for 77 per cent of the continent’s online gambling gross gaming revenue (GGR), according to a new report by Gaming Compliance International (GCI).

GCI’s Online Gaming 2024-2025: Africa, the first comprehensive assessment of online gambling across all 54 African nations, found that Africa’s total online gambling GGR reached $23 billion in 2025. Regulated operators accounted for 23 per cent of the market, up from 22 per cent in 2024, with regulated GGR increasing from $4.4 billion to $5.2 billion.

The report also recorded continued growth in online gambling participation. The proportion of Africa’s population interacting with online gambling increased from 13 per cent, or 198 million people, in 2024 to 14 per cent, or 215 million people, in 2025. However, unregulated operators still generated $17.8 billion, representing 77 per cent of total online GGR, while the number of unregulated operators targeting African consumers increased from 3,644 to 4,129.

The findings indicate that despite continued growth in regulated online gambling, most online gambling activity in Africa remains concentrated within the unregulated sector.

Measuring the whole marketplace

To better understand the findings of GCI’s report, SiGMA News spoke exclusively with Ismail Vali, President of Gaming Compliance International (GCI), who said the analysis was built around a principle regulators have often overlooked: licensed operators represent only one part of the online gambling ecosystem.

Vali said, “The approach was prompted by a simple reality: consumers experience one online gambling marketplace comprising both regulated and unregulated sectors. The purpose of regulation is not only to regulate licensed operators. It is to sensibly regulate the entire marketplace.”

Vali said regulators naturally have greater visibility of licensed operators because they report data, pay taxes and operate under regulatory supervision. That visibility, however, can create a misleading picture of the market if policymakers use licensed-sector activity alone to assess whether regulation is working.

The report found that the unregulated sector accounted for 77 per cent of Africa’s online GGR in 2025, while representing 89 per cent of audience exposure.

Looking beyond regulatory activity

Vali argued that regulatory performance should be measured through marketplace outcomes rather than administrative activity. He said, “In practice, regulators should start with their intended objectives and measure whether those objectives are producing outcomes across the total marketplace.”

He said regulators should instead assess whether more consumers are choosing licensed operators, whether participation in unregulated gambling is declining, whether tax collection is increasing sustainably, whether consumer protections are reaching a larger proportion of gamblers and whether criminal participation is losing market share.

By contrast, indicators such as the number of licences issued, compliance reviews completed and enforcement notices served demonstrate regulatory activity, but do not necessarily show whether policy objectives have been achieved.

“The number of licences issued, compliance reviews completed or enforcement notices served may demonstrate regulatory activity, but they do not establish regulatory success.”

Instead, Vali believes successful regulation should ultimately be reflected in stronger channelisation, sustainable tax collection, improved consumer protection and a shrinking unregulated sector.

“Ultimately, it is marketplace outcomes, not the volume of regulatory activity, that are the true measure of success.”

The report reaches a similar conclusion, arguing that effective regulation should be judged by its ability to attract consumers into the regulated sector and keep them there, rather than by activity within the licensed market alone.

The four pillars of market competitiveness

While regulatory frameworks differ across Africa’s 54 online gambling markets, GCI’s report identifies four core public policy factors that influence the competitiveness of licensed operators: customer taxation, operator taxation, payment infrastructure and product availability. Together, these factors determine the competitiveness of the regulated sector.

Vali said there is no single policy challenge common to every African jurisdiction because each market operates under different regulatory and economic conditions. However, he identified taxation architecture as the issue that most consistently influences the success of regulated markets.

He said, “There is no single answer across all 54 markets because their regulatory conditions differ significantly. However, if one area must be identified, I would say taxation architecture, particularly the cumulative effect of operator and customer taxation.”

Taxation can influence consumer behaviour

According to Vali, taxes imposed directly on customers have an immediate impact on the value they receive from licensed operators. Since unregulated operators are not subject to the same tax obligations, excessive customer taxation can encourage players to migrate to unlicensed platforms that offer more favourable returns.

“Customer-facing taxes directly change the value consumers receive. Unregulated operators do not apply those costs, so excessive customer taxation provides consumers with an immediate financial incentive to leave the regulated sector.”

He said operator taxation can have a similar effect, albeit indirectly. Higher tax burdens may reduce the ability of licensed businesses to compete on odds, pricing, bonuses, product offerings and the overall customer experience. In such cases, governments may raise nominal tax rates but collect a smaller share of total gambling activity as consumers increasingly turn to unregulated operators.

“Regulators may increase a nominal tax rate while ultimately capturing a smaller proportion of the total marketplace because activity migrates outside regulation,” he added.

Payments and products are equally important

Vali believes taxation cannot be considered in isolation. Payment infrastructure and product availability also influence whether regulated operators remain competitive.

He noted that payment systems with high costs or limited competition can function as an additional barrier for consumers, while restrictions on legal gambling products may encourage players to seek alternatives offered by unregulated operators.

He said, “Payments and product availability remain major issues, but they often interact with taxation. Expensive or monopolistic payment systems can function as an additional hidden tax, while product restrictions direct existing demand toward operators that ignore those restrictions.”

For regulators, he said the key policy question should be whether the overall regulatory framework encourages consumers to choose licensed operators.

“The central policy test should therefore be: Does the combined regulatory structure make the regulated sector attractive, accessible and competitive enough for consumers to choose it?”

Optimisation over higher tax rates

Vali said the report does not argue for lower taxation. Instead, it advocates optimised tax structures that support sustainable tax collection while strengthening the competitiveness of the regulated sector.

“The report does not argue for low taxation as an end in itself. It argues for optimised taxation that produces sustainable tax collection across a larger regulated share of the marketplace.”

He said this reflects the broader philosophy behind GCI’s assessment of Africa’s online gambling sector.

“This is why the report frames well-designed regulation not as a brake on the market, but as what enables a sustainable one. The choice is not between regulation and growth.”

The report similarly concludes that taxation, payments and product policy should be viewed as interconnected elements of market design. Together, they influence whether consumers enter and remain within the regulated sector, ultimately determining the effectiveness of consumer protection measures and the sustainability of tax revenues.

A framework for regulating the whole marketplace

Beyond analysing the size and composition of Africa’s online gambling market, GCI’s report proposes a regulatory model that it believes can help governments tackle the dominance of unregulated operators. The framework, known as MPEO or Monitor, Police, Enforce and Optimise, argues that effective regulation begins with understanding the entire marketplace rather than focusing solely on licensed operators.

Vali said that while each element of the framework is important, monitoring should be the immediate priority for regulators seeking to reduce the influence of the unregulated market over the coming year.

“Monitoring does not replace policing, enforcement or optimisation, but it makes all three possible.”

Why monitoring comes first

According to Vali, regulators cannot effectively oversee a market if they only have visibility of licensed operators while most online gambling activity takes place outside the regulated sector.

“You cannot regulate a marketplace you cannot see, and regulation must ultimately oversee the entire marketplace, not only its licensed part.”

The report estimates that Africa had 4,129 unregulated operator destinations in 2025, while 89 per cent of audience exposure was linked to unregulated gambling. Vali said these figures illustrate why enforcement efforts often fail to achieve lasting results when regulators lack a complete picture of the market they are trying to oversee.

Building a complete picture of the market

Vali said the first practical step is to establish a continuously updated national baseline that captures activity across both the regulated and unregulated sectors.

He said this should cover the size and market share of each sector, every active website and mobile application serving local consumers, audience exposure across digital channels, payment providers facilitating gambling transactions, differences in products, pricing and promotions between regulated and unregulated operators, and trends in consumer movement between the two markets.

According to Vali, this level of visibility would enable regulators to determine where intervention is likely to have the greatest impact. “Regulators can identify which operators and ecosystem participants cause the greatest harm, police them proportionately, enforce against the supply chains enabling them and identify where regulated-sector policies are unintentionally making unregulated alternatives more attractive.”

From enforcement to optimisation

Rather than viewing policing and enforcement as standalone solutions, Vali said they should form part of a broader regulatory process informed by continuous monitoring and followed by policy optimisation.

“The sequence matters: Monitoring provides visibility. Policing identifies the problem. Enforcement protects regulatory integrity. Optimisation makes the regulated sector worth choosing.”

The report argues that enforcement alone cannot reduce the size of the unregulated market if regulators do not understand why consumers continue to use illegal operators. Factors such as taxation, payment systems and product restrictions may inadvertently make licensed operators less competitive, reinforcing the need to evaluate the market as a whole before introducing regulatory interventions.

For Vali, the objective is not simply to increase enforcement activity but to ensure regulatory decisions are supported by comprehensive market intelligence.

“Without total-marketplace monitoring, enforcement will remain reactive and fragmented.”

Reform depends on implementation, not legislation

Although Africa’s online gambling markets are at different stages of development, Vali believes the jurisdictions with the greatest potential over the next two to three years will not necessarily be those introducing new gambling laws. Instead, he argues that progress will depend on how effectively existing regulatory frameworks are implemented and refined.

Rather than identifying specific countries, Vali said the markets best positioned for improvement fall into two broad categories.

Markets with a strong regulatory foundation

The first group comprises jurisdictions that have already established a regulated online gambling framework, supported by legal online sports betting and casino products, transparent licensing systems and stable regulatory oversight.

While many of these markets continue to lose a sizeable share of gambling activity to unregulated operators, Vali believes they already have the foundations needed to improve channelisation through targeted policy changes.

“These markets are not yet optimised; a significant share of their activity remains unregulated. But they demonstrate that the structure works, and that further channelisation can be achieved from a base that already exists.”

The implementation challenge

The second category includes markets where legislative and licensing frameworks are largely in place, but implementation gaps continue to affect the competitiveness of regulated operators.

According to Vali, shortcomings in enforcement, taxation or payment infrastructure can still push consumers towards unregulated alternatives, even where a licensing framework already exists.

“Licensing frameworks exist, but enforcement, taxation or payment conditions still push consumers toward unregulated alternatives. These are the markets where relatively focused reform can deliver disproportionately large improvements, which is one of the central findings of the report.”

He suggested that addressing these operational challenges may deliver greater benefits than introducing entirely new regulatory regimes.

Measuring whether reforms are working

For Vali, the effectiveness of regulatory reform should not be judged by the amount of legislative or administrative activity it generates.

“What I will be watching most closely is not new legislation or the number of licences issued. Those measure activity, not success.”

Instead, he said regulators should evaluate whether reforms are producing measurable improvements across the marketplace, including a larger regulated market share, lower consumer exposure to unregulated operators, better access to licensed products and stronger consumer retention within the regulated sector.

“Those are the outcomes that tell us whether reform has worked, and they are the measure by which every market should ultimately be judged.”

He added that governments should focus on improving the effectiveness of existing regulatory systems rather than simply expanding them.

“The opportunity is not simply to regulate more; it is to optimise better.”

Vali’s assessment reflects one of the report’s central themes: regulatory success is determined not by the number of rules introduced or licences granted, but by whether policy changes encourage consumers to participate in regulated markets, strengthen consumer protections and reduce the influence of unregulated operators across the wider marketplace.

Africa’s opportunity lies in optimisation, not expansion

Having analysed all 54 African markets, Vali believes one of the biggest misconceptions among international operators and investors is that Africa’s online gambling opportunity is primarily about future market growth.

Instead, he argues that the continent already has a sizeable online gambling market. The greater opportunity lies in improving how existing demand is channelled into regulated markets rather than creating new demand.

“Africa’s marketplaces should be defined by their opportunity, not their challenges, and that opportunity is one of optimisation, not expansion.”

The report estimates that Africa generated $23 billion in online gross gaming revenue (GGR) in 2025, with approximately 215 million people interacting with online gambling. For Vali, these figures demonstrate that consumer demand is already firmly established across the continent.

“The real opportunity is not creating more demand. It is optimising each national marketplace so that more of the demand that already exists is captured by the regulated sector.”

Looking beyond market size

Vali said international operators often assess African opportunities based on population size, smartphone penetration and projected revenue growth. While those indicators remain important, he believes they reveal only part of the picture.

According to Vali, the long-term success of regulated businesses depends on whether the regulatory environment allows them to compete effectively with unregulated operators.

“Licensing alone does not create a successful market. A marketplace must also be optimised across taxation, payments, product availability, enforcement and consumer accessibility.”

Rather than prioritising countries with the largest populations or fastest-growing gambling sectors, Vali said investors should evaluate which jurisdictions are best positioned to convert existing demand into sustainable participation within the regulated market.

Vali said, “The better question is not which African market has the most consumers. It is which market is most capable of converting existing demand into sustainable regulated participation, where consumers can easily access regulated products, transact affordably, receive competitive value and remain within the regulated sector rather than migrating to unregulated alternatives.”

West Africa offers a different perspective

The report highlights regional differences in regulated market performance across Africa. The report suggests that some of the strongest examples of regulated market performance come from regions that receive comparatively little international attention.

In 2025, West Africa recorded the continent’s highest regulated market share at 31 per cent, ahead of Southern Africa (28 per cent), Central Africa (22 per cent), East Africa (15 per cent) and North Africa (0.3 per cent). Rather than highlighting the continent’s largest economies, Vali said these findings demonstrate that effective policy design and market optimisation can have a greater influence on regulated market performance than market size alone.

A shift in regulatory thinking

Drawing on GCI’s analysis of all 54 African markets, Vali argues that Africa’s online gambling opportunity should be measured not by future growth alone, but by how effectively existing demand is channelled into regulated markets.

That, he said, requires policymakers, operators and investors to look beyond market size and focus on the conditions that make licensed gambling competitive and accessible.

He said, “The opportunity in Africa, therefore, is not simply expansion. It is optimisation: identifying where relatively focused changes to taxation, payments, products, enforcement and coordination can deliver disproportionately better marketplace outcomes.”

Big opportunities attract big decision-makers. From 15–17 February 2027, SiGMA Africa brings together 2,700 delegates, 700 operators, and key industry stakeholders in Cape Town. This is your moment!