100 hours in the Dark Affected Uganda Gaming and FinTech Space

An internet blackout hit poor Ugandans when the authority ordered an internet shutdown on the eve of the presidential election—seeing all related activities online in Uganda collapse though the gambling industry is no exception.

The gambling business from retail and online betting activities was all put to a halt, same with the Fintech space many Ugandans could not complete transactions or payments due to the internet shutdown. Early last year, the coronavirus hard hit the Uganda gambling industry. The same with the Fintech space during corresponding lockdown numbers of gaming companies are still recovering from the Covid-19 crisis, likewise the payment space. Meanwhile, considering the dominance of the retail form of betting among the Ugandans populace and the popularity of major European leagues that was suspended for several months in mid-April 2020 was a devastating blow to sportsbook operators while the land-based casino operators felt abrupt of the lockdown in Uganda as well.

The 100 days in the dark was a hammer for both the industry stakeholders still recovering from the pandemic crisis, and according to report, currently, approximately 60 licensed operators are operational in Uganda over 2,000 retail branches across the country, and the online was not functioning for 100 hours of an internet blackout. While affecting both retail-centric and online customers, they were all affected by not being able to place a wager on their favorite sports betting sites.

Even though the Covid-19 lockdown accelerated the adoption of digital payment and iGaming betting and gambling in Uganda, most customers find it easier to make payments online and bet online than USSD mobile betting shortcode. Even though the authorities apologize for the inconvenience and shutdown was to avoid outside interference in the election. However, long time leader Yoweri Museveni was declared to have won against popular singer-turned politician Bobi Wine. Though digital right campaigners said the move hit earnings and left citizens unable to pay bills, send money, participate in their daily online activities, businesses were hit badly. The gaming industry was a testament to the menace surrounding the internet shutdown.

Businesses in the formal and informal sector that increasingly rely on the internet and digital platforms to keep their activities going were hugely impacted. According to the Internet freedom monitor, Netblocks calculate that the almost five-day shutdown cost the Ugandan economy around $9 billion. This includes mobile money transactions, which many Ugandans rely on for payments, e-commerce, gaming companies, airline bookings, and app-based taxi services. The Financial Technology and service Providers Association (FTSPA) estimates that companies in the sector lost at least 66 billion Ugandan shillings ($17.89 million) daily during the shutdown. This includes companies such motorcycle taxi-hailing apps with more than 22,000 drivers in Kampala.

While according to DataReportal, there are more than 10 million internet users in Uganda in 2020, around 24% of the country’s population. However, last year saw the coronavirus pandemic forced many businesses to accelerate their online service. Many of whom are not online with their business offering to consider digital in that aspect. Therefore, Ugandans had just started to build trust in that aspect of the digital economy, particularly in the payment space and the gaming industry.

Many companies in the gambling industry have not reopened their betting shops since the post-lockdown, meaning they are conducting business online. In contrast to the government’s move to impose a blackout on the internet, such actions could break people’s confidence. And they could have a lasting effect on the digital economy goals of the country.

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