The Kenyan government has ordered leading telecom firm Safaricom to stop processing payments for online sports betting companies.
The directive, issued by the acting director of the Betting Control and Licensing Board (BCLB), Liti Wambua, comes after the regulator revealed that licenses for all 27 betting firms in the country had not been renewed, pending an ongoing inquiry into their suitability to operate in Kenya.
“Consequently, we request you to suspend their pay-bills and short codes until otherwise advised,” Wambua said in the letter to Safaricom.
The move could potentially shut down a lucrative revenue stream for Safaricom, as the betting industry has become a significant part of the company’s earnings in recent years. Safaricom’s market-leading network is essential for the betting firms to take bets, communicate with users, and process payments through the popular M-Pesa mobile money platform.
In response, Safaricom has requested time to carry out the order, as an abrupt implementation would result in millions of customers being shut out of funds already deposited in the gaming wallets of the various betting firms. The company also noted that two of the gaming companies had obtained court orders allowing them to continue their operations without a renewed license, further complicating the situation.
The crackdown on the sports betting industry is part of the Kenyan government’s efforts to address the social impact of the rapidly growing sector. In May 2023, the country introduced new gambling regulations, including a ban on outdoor and social media advertising for betting companies.
While the betting firms have defended their activities, claiming to be law-abiding corporate citizens, the government’s decision to suspend their operations through Safaricom’s payment processing services could have significant implications for the industry’s future in Kenya.
