
By Alexis Akwagyiram and Didi Akinyelure
LAGOS, June 25 (Reuters) - Online sports betting wagering is flourishing in soccer-mad Nigeria mostly thanks to payment systems established by homegrown technology firms that are beginning to make online businesses more practical.

For many years, mobile payments stopped working to remove in Nigeria as they have in nations such as Kenya, where Safaricom's M-Pesa money transfers have actually promoted a culture of cashless payments.
Fear of electronic scams and slow internet speeds have actually held Nigerian online consumers back but wagering firms states the brand-new, fast digital payment systems underpinning their sites are altering mindsets towards online deals.
"We have actually seen considerable growth in the number of payment options that are available. All that is definitely changing the gaming area," stated Seun Anibaba, CEO of Lagos State Lotteries Board, video gaming regulator in Nigeria's industrial capital.
"The operators will choose whoever is much faster, whoever can link to their platform with less issues and glitches," he said, including that taxes from sports betting in Lagos State increased 30 percent to 40 percent in 2017 from 2016.
That growth has actually been matched by a rise in web payments, according to data from the Nigeria Inter-Bank Settlement System (NIBSS), which is owned by the central bank and licensed banks.
In 2016, there were 14 million web payments worth a total 132 billion naira ($420 million). Transactions leapt to 29 million worth 185 billion in 2017 and in the very first quarter of 2018 there were nearly 10 million worth 61 billion.
With a young population of nearly 190 million, rising smart phone usage and falling data costs, Nigeria has actually long been seen as a fantastic chance for online services - once consumers feel comfy with electronic payments.
Online gambling firms say that is taking place, though reaching the tens of millions of Nigerians without access to banking services remains a challenge for pure online retailers.
British online wagering firm Betway opened its very first African business in Kenya in 2015, followed by Uganda, Ghana and South Africa. It introduced in Nigeria in January.
"There is a progressive shift to online now, that is where the industry is going," Betway's Nigeria manager Lere Awokoya stated.
"The growth in the number of fintechs, and the government as an enabler, has assisted the service to thrive. These technological shifts motivated Betway to begin running in Nigeria," he said.
FINTECH COMPETITION
sports betting companies cashing in on the soccer frenzy worked up by Nigeria's participation worldwide Cup state they are finding the payment systems produced by regional startups such as Paystack are proving popular online.
Paystack and another local start-up Flutterwave, both founded in 2016, are providing competition for Nigeria's Interswitch which was set up in 2002 and was the primary platform utilized by businesses running in Nigeria.
"We added Paystack as one of our payment options without any fanfare, without announcing to our customers, and within a month it shot up to the number one most pre-owned payment option on the website," said Akin Alabi, creator of NairabBET.
He stated NairaBET, the nation's 2nd biggest sports betting company, now had 2 million regular clients on its website, up from 500,000 in 2013, and Paystack stayed the most popular payment choice considering that it was added in late 2017.
Paystack was set up by two Nigerian computer technology graduates, Shola Akinlade and Ezra Olubi, who received early stage financing in Silicon Valley's Y-Combinator program.
In December 2016, it raised $1.3 million from investors consisting of China's Tencent and Comcast Ventures in the United States.
Paystack, based in the mad Ikeja district of Lagos, said the variety of monthly deals it processed increased from about 8,000 in early 2016 to more than 900,000 as of June 2018.
"In early 2016 we were processing about $3,000 a month. Today we process well over $11 million every single month," stated Emmanuel Quartey, Paystack's head of growth.
He stated a community of developers had actually emerged around Paystack, producing software application to integrate the platform into sites. "We have seen a growth because community and they have carried us along," said Quartey.
Paystack stated it enables payments for a number of sports betting companies but likewise a wide range of organizations, from utility services to carry companies to insurance provider Axa Mansard.
Flutterwave, co-founded by Nigerian business owner Iyinoluwa Aboyeji, is also backed by the Y-Combinator programme as well as investor Greycroft Partners and Green Visor Capital and the Omidyar Network. It raised $10 million last year.
FOREIGN INVESTMENT
Shifts in Nigeria's payment culture have corresponded with the arrival of foreign investors intending to use sports betting.
Industry specialists say the sector creates about $1 billion a year and is likely to grow faster than in South Africa and Kenya where the service is more established.

Russia's 1XBet and Slovakia's DOXXbet have both set up in Nigeria in the last two years while Italy's Goldbet was ahead of the trend, taking a half stake in market leader Bet9ja when the Nigerian company introduced in 2015.
NairaBET's Alabi said its sales were divided between shops and online however the ease of electronic payments, cost of running stores and ability for consumers to prevent the stigma of gambling in public implied online deals would grow.
But despite advances in digital payments, Kunle Soname - chairman and co-founder of Bet9ja - said it was necessary to have a shop network, not least due to the fact that lots of customers still stay reluctant to invest online.
He stated the company, with about 60 percent of Nigeria's sports betting market, had a comprehensive network. Nigerian wagering stores typically function as social hubs where clients can enjoy soccer totally free of charge while placing bets.
At a BetKing hall deep inside the busy Oshodi market in Lagos, dozens of soccer fans collected to watch Nigeria's final heat up video game before the World Cup.
Richard Onuka, a factory worker who makes 25,000 naira a month, was fixated on a TV screen inside. He stated he began gambling three months ago and bets approximately 1,000 naira a day.
"Since I have been playing I have actually not won anything however I believe that one day I will win," stated Onuka. ($1 = 314.5000 naira) (Reporting by Alexis Akwagyiram and Didi Akinyelure in Lagos; modifying by David Clarke)
