Jackpot! The legalization of slots in Kenya

Jackpot! The legalization of slots in Kenya

The legalization of casino betting is not new in Kenya. Counting on more than 30 land-based casinos, Kenyans looking for the real experience find themselves in a scenario much similar to the best Las Vegas casinos, many of which offer a variety of casino games, including slot machines, blackjack, and roulette tables, along with high-stakes poker and more. Amidst Kenyans’ favorite games, the variety of slot machines still represent one of the most lucrative and entertaining attractions both online and land-based.

However, the possibility of betting online brought a new vision to Kenyans and their habits. According to this study by the University of Lethbridge with internet gamblers, people interviewed typically spend about 5 hours per week gambling online, in some cases, 2 hours per week. Only 4.1% stated they gamble online for more than 20 hours per week.

Part of this online gambling boom is due to M-Pesa, the first mobile money service in the African continent, being born in Kenya. Research by star.co states that “The M-Pesa has played a big role in encouraging savings and (...) facilitated a surge in sports betting. It has also opened doors for Kenyan youths to play various online games in online casino platforms”.

This new landscape increased opportunities to play casino games and offered convenience and variety, allowing players to enjoy the casino experience from the comfort of their homes, at any time. Online platforms often provide interesting bonuses and higher payout percentages compared to physical casinos. The simplicity associated with these games in a controlled environment attract a growing number of young adults seeking entertainment and potential rewards. 

To illustrate slots legalization, it’s also important to talk about Kenyan laws for online betting nowadays. Since 2019, online casinos have become licensed while restricting overseas operators, regulating advertising, and imposing taxes. Kenya's existing laws already permit various forms of gambling, including betting, lotteries, and slots, without distinction between games of skill or chance except by their taxation.

Although any form of betting and casinos are legal in Kenya, the 2022 proposed law in Nairobi county restricts all gambling venues to five-star hotels, limiting operating hours from 8 pm to 6 am, even for mobile apps, banning ads from 6 am to 10 pm, and requiring cashless payments. If passed, this could greatly affect Kenya's gambling scene, particularly in Nairobi.

Under this system, Kenya’s taxation can go up to 30% corporate tax on their profits. While aimed at industry regulation, these taxes have the potential to harm market expansion and earnings. Furthermore, the proposed Gambling Control Bill of 2023 introduces additional financial burdens, including a 15% tax on gross gaming revenue along with a monthly fee.

Compared to Kenya, Brazil’s approach to regulating gambling is slightly softer. With an expanding iGaming market, Brazil has recently taken steps to legalize various forms of casino games, including sports betting and slots online. However, the regulatory landscape surrounding land-based slots remains uncertain. 

The prospect of physical casinos emerging in Brazil signals a departure from the longstanding prohibition of gambling, which originated in 1946 under President Dutra’s government. This decision was greatly motivated by moral and religious convictions, which led to job losses and economic disruption.

As expressed in the ICLG regulation report for Brazil, although betting has been formalized, slot machines are still prohibited in the country, as well as land-based casinos. However, people can play slots online with the correct taxation. In this research by Statista we can see how the online legalization increased casino activities in Brazil in 2023.

Due to these shifts in online scenarios and new gaming styles, we can also expect technological improvements in games such as slots, making them more realistic for home-players. As commented in this post by Whimsy games, in 2024 we expect that “virtual and augmented reality are poised to integrate seamlessly into slot games, promising an immersive gaming experience beyond bounds. The smartphone revolution will continue to drive the gaming landscape, with personalized gameplay taking center stage.”

Therefore, Kenya's high taxes on gaming operators may hinder the improvement of online gaming experiences. This could not only impact the country's economy but also put its cultural heritage at risk. Finding a balance between regulation and industry growth is crucial for the sustainable development of the gambling sector while preserving national traditions.