Performing the Correct Actions – iGB
Benjamin Anaepu, the head of the Anambra State Gaming Board, discusses how the state’s regulatory body is working to draw gaming firms to invest in the state while also bolstering player safeguards.
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Performing the Correct Actions
Benjamin Anaepu, the head of the Anambra State Gaming Board, discusses how the state’s regulatory body is working to draw gaming firms to invest in the state while also bolstering player safeguards.
“Many individuals don’t even comprehend what regulation is,” Benjamin Anaepu clarifies. “In Anambra, we’re doing what’s right – we’re ensuring every operator is legitimate.”
As the head of the Anambra State Gaming Board, the regulatory body for this state in southeastern Nigeria, Anaepu is in charge of overseeing the state’s gaming industry while ensuring it remains a desirable region for operators.
The regulatory body was established in 2016 as a joint venture between the Anambra State Investment Promotion and Protection Agency (ANSIPPA) and international gaming companies. Anaepu states this was done to reduce government bureaucracy and operational costs.
“At the time the state government recognized they needed to implement a system,” Anaepu explains. “Prior to that, many people were losing funds, but even then there were laws, although they weren’t being enforced.”
In reality, legislation was established as far back as the 1970s, but stringent rules were only enforced in 2016.
“Currently, with the flourishing domestic gaming sector, everyone is clearly aware of the advantages it provides,” he stated. “These advantages include: internally generated funds, tourism, employment opportunities. Naturally, there are also some downsides, such as dependence. We must create a suitable regulatory structure to ensure that both businesses and players can reap the benefits and address the drawbacks.”
Complete transparency
This resulted in the implementation of a licensing framework that mandates all prospective license holders to register as Nigerian businesses and provide the National Lottery Commission with their equity details, as well as a bank guarantee or insurance policy to demonstrate their capacity to operate within the state. Moreover, directors are required to undergo background checks to confirm their compliance with tax obligations.
Moreover, the tax rate for sports betting is 1.5% of gross revenue – lower than other Nigerian states, such as Lagos’ 2.5%, Yarnap highlighted. The license fee is also modest, at 10 million Naira (£22,770), compared to Lagos’ 50 million Naira.
Nevertheless, this must be paid in addition to the federal betting tax, which is 20% of gross revenue. While acknowledging the double taxation model “is a duality”, Yarnap believes obtaining both federal and state licenses is highly valuable.
“I suggest that anyone should acquire both licenses,” he said.
It might not be a popular notion to inform business owners that they must pay double taxes, but the tax rate is reasonable enough for successful companies to manage paying twice the amount.
“If you are prepared for both scenarios, you can still break even. Provided your payout rate is high and you offer appealing bonuses or prizes, you will succeed.”
Responsible Concerns
Although this double taxation model could result in operators entering the market without authorization, Yarnap asserts that illegal gambling is not currently a significant problem, despite the establishment of reporting systems that enable citizens to report unlawful activities.
These systems can also be used to report underage gambling, with Anambra State enforcing a strict 18+ age limit on all gambling games. Those who violate this rule face penalties and even the revocation of their licenses.
He states that this is part of a “one-on-one” responsible gambling approach, which includes reducing excessive advertising and limiting the locations where gambling establishments can be opened.
Ultimately, he aims to go further and ensure that customers do not gamble beyond their financial capabilities.
“[We] want to develop an automated system that allows us to monitor all the bets,” he says. “In this way, if a player places a bet equivalent to half their salary, we can intervene.”
Healthy Competition
In Yarnap’s opinion, Anambra State is competing with Lagos and Rivers State to become the most appealing starting point for gambling operators.
While Anambra State holds the eighth position in the nation in terms of population, it also boasts the second highest population density after Lagos. In 2017, Governor Chief Willie Obiano asserted that the state had the lowest poverty rate.
“Here, investors are simply swimming in a sea of opportunity,” Yanap stated. “Our inhabitants have a significant amount of discretionary income and a long history of wagering.”
Consequently, there are numerous popular forms of gambling present: “We have sports betting, casinos, lotteries, virtual games, and even raffles where individuals can win prizes like chickens, which might appear humorous, but it’s highly favored.
“We also have pool betting, which is quite substantial, so we have a wide array of products to cater to diverse demographics.”
He further mentioned that this is almost entirely conducted through offline channels.
“At every gathering I attend, I hear remarkable data concerning the expansion of mobile gaming, but in Nigeria, individuals favor offline gaming,” Yanap explained. “Some businesses generate over 80% of their revenue through offline operations.”
He stated that while internet access is not a concern, mobile payments simply lack public confidence, implying that Anambra State – or Nigeria – shows no signs of mimicking the M-Pesa-driven mobile gaming surge in Kenya.
“It will require some time to catch up. When mobile payments are widely accepted, we will witness growth, but it will take time.
“But just because players aren’t on mobile doesn’t signify that the market isn’t expanding,” he continued.
While individuals utilize their mobile devices, they still engage in wagering at physical establishments and subsequently claim their prizes at the same locations, as observed in certain regions of the United States – the conventional approach remains prevalent.
In essence, he stated that his role is straightforward: “Operators are obligated to disburse winnings promptly, and patrons must be shielded from the development of gambling issues.
“In essence, our objective is to enhance the industry’s safety and integrity,” he elaborated. “This initiative is specifically tailored for those who approach gambling with seriousness.”
Benjamin Yanap will deliver a presentation at the “Staying Current: Regulatory Adaptation to Technological Advancements” panel discussion on the second day of the ICE Africa conference, scheduled for October 2-3 at 11:15. For further details, access this link.
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