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The Rise of Sports Betting in South Africa

August 25, 2022

Liezl Basson

Sports betting is on a direct trajectory to become one of the most popular digital goods and services categories in South Africa. Here’s what Banks and Retailers need to know about the newest VAS performer and why you should add it to your business portfolio.

Sports betting is growing fast. Due to the national lockdown in 2020, online entertainment has surged and as such, so has online betting. Our latest 2022 Digital Goods and Services Report has found that sports betting accounts for 16% of all VAS sales in volume, making it the VAS product with the largest growth over the past two years. The majority of consumers place bets a few times a week with the average betting amount being R42. Furthermore 45% of consumers indicated that they expect to increase their spend over the next six months.

Betting vouchers are currently sold from major retailers, spaza shops in rural areas, as well as South Africa’s leading banks – either via internet banking, their bank app or USSD. While in-store purchases at retailer till points and money market counters remain the most popular, bank apps are not far behind.

Sports betting provides an opportunity to both banks and retailers, especially when it comes to building out your digital goods and services marketplace. With a user-friendly online offering, banks can increase their market share and lead the way when it comes to sports betting. On the other hand, by expanding to an attractive online betting service retailers can solidify their hold on the market through building out their already-popular in-store offering.

To recover lost revenue due to the COVID-19 restrictions, sports betting operators have undergone various user-focused enhancements. Some are offering more exclusive options such as weather betting, novelty betting or celebrity betting while other operators are promising a more personalised experience with betting tips and match reminders.

Betting providers are also marketing heavily. Perhaps indicative of this rise has been an increase in betting sponsorship of professional sport teams. Hollywoodbets, a South African organisation, not only sponsors the KZN-based Dolphins cricket team, but are also the principal shirt sponsor of Brentford Football Club in the English Premier League.

Although there is an undeniable increase in the number of bets placed over the past few years, many enterprise representatives interviewed for Electrum’s research report still expressed a concern over the social and ethical implications of betting. The moral aspect of this service is why Google’s Play Store only allows gambling apps to operate in a limited number of countries – a list that still excludes South Africa.

Ethical debate aside, with sports betting being the second-most popular VAS product it is important to understand the betting ecosystem in South Africa along with the various stakeholders involved. The major players are betting providers such as betting operators and voucher providers, and VAS platform providers.

Betting operators: A business that is licensed to operate in sports betting from which consumers can purchase and place bets. The sale of betting vouchers allows underserved consumers to use their cash to access online betting services.

Voucher providers: Offer consumers digital payment solutions by means of generic goods and services vouchers that can be redeemed at a wide network of partners, including betting operators. The versatility of uses for these vouchers holds appeal to the consumer who can choose from a variety of betting operators even after having purchased a voucher.

Digital goods and services platform: Businesses, like Electrum, provide a VAS platform that integrates into many different aggregators and providers to help you deliver a wider portfolio of digital goods and services.

Adding betting to your online VAS portfolio gives you a foot in the door when it comes to responding to the rise of this service in South Africa. As an enterprise business you can either have multiple integrations with voucher providers and betting operators, or with a single integration, connect into one digital VAS platform to connect your business to multiple betting operators. Some of the benefits from integrating into a digital goods and services platform provider include:

  • More choice for your customers

A platform not only connects you to multiple providers for betting, but it can also expand your digital marketplace with more VAS products to ensure your customer gets everything they want.

  • Quick go-to-market

Pre-built integrations allows for a plug-in experience and gets your service up and running fast.

  • More control over transactions

Redirect transactions to either your preferred or the most reliable provider at the time, ensuring that you have more control over your commercials as well as offer an always-on service.

Electrum’s Digital Goods and Services Platform helps your business to seamlessly add sports betting and other VAS to your portfolio. Download our 2022 Digital Goods and Services Report to learn more or chat to us directly.

Liezl Basson

Liezl joined Electrum’s Marketing team in 2020 from a (hard lockdown) Zoom screen. Nowadays, if she’s not in her sunny corner in the office researching everything about money transfer and deep diving into campaigns and analytics, she’s probably strolling, coffee in hand, whale watching somewhere between Camps Bay and the V&A Waterfront.

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