Two industry lawyers, Babatunde Ibidapo-Obe of Obe & Co and Hans Wolf Kessler of Kessler Stockhausen present the two sides of the coin and discuss the emerging African market and the posed risks and rewards amidst an ever-changing financial landscape
The two lawyers started by introducing themselves, and immediately Hans Wolf Kessler took the opportunity to set the premise and initiate the questions and the general discussion, saying how when people talk about the African market it is always important to keep in mind the vastness of the continent, something which has always been brought up when continental markets start to become interesting for gaming operators.
To this, Babatunde Ibidapo-Obe presented some context saying how there are different regulators fighting for leadership, but that essentially a growing sector which can help the fixing of a lot of issues is that of payment methods and he mentioned Nigeria, his home-country, as an example, saying how in 2019, there were massive investments to reach the unbanked, in an attempt to focus on financial inclusion. He then asked Kessler to list certain issues that he's encountered that hinder the process of clients attempting to enter the African market.
Watch the discussion right here.
To this, Kessler listed three major issues, all of which are related to payments; how to get the money from the customer or player, how to get the money out of the country, and how to get the money into the company's bank. The issues that raise these questions are certain differences that the continents have when it comes to the gaming industry, one of which is definitely the fact that there are very few markets in Europe where regulation forms are different to what actually happens on the ground, unlike Africa, where the regulation in practice seems to be a bit more malleable.
In reply to this Ibidapo-Obe agreed but also added that the issue is something which is in the process of being improved, saying how
With a lot of international investment and partnership such as Visa and Interswitch, transcontinental transactions will start to get easier and easier"
This lead to Kessler continuing on the issue of payments, and asking Ibidapo-Obe if European operators will find it easy to attach themselves to mobile payment systems such as E-Mpesa, to which his reply was that there is a quiet war happening between banks and telecoms companies since whoever controls that space controls everything and so due to the regulatory scope around Nigeria, those transactions aren't being progressed. He also added that there are already quite a number of countries where they're putting together certain frameworks of regulation, so once this picks up the hope is that they is a some sort of regulatory convergence that will facilitate the whole process.
The two concluding points firstly included grey markets, with Ibidapo-Obe saying how the issue there is not about where the money is coming from but rather, the fact that it is not properly taxed, and secondly, the panelists ended their discussion with Ibidapo-Obe asking Kessler to explain whether it is political instability or financial risk that makes certain operators hesitant to move into the African continent in it's current situation.
To this, Kessler ended by saying that it's two issue; legal uncertainty due to the distinction of theory and practice as well as in regulation as well as in taxes, but also political instability, where you have certain things which don't happen in Europe which would naturally alarm certain operators, all of which pointed to the key factor of stability which is something that is still in progress in the emerging market.
If you are interested in the emerging sector in Africa, SiGMA is launching SiGMA Africa in 2022, starting with the inaugural summit in Cape Town. For more details please get in touch with Sophie or Hamza.
About SiGMA's revamped website:
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