Unemployed Ugandan Youth Gravitate to Sports Betting

By IMTFI Researchers Bruno Yawe and Kizito Ssengooba

Billboard of a betting shop in Kampala (Photo by authors)   

Sports betting can be described as the activity of predicting sports results and placing a wager on the outcome which may result into a loss or a win. About 62% of Uganda’s youth are not in any form of employment and the majority of them live in urban centers (ActionAid International Uganda, Development Research and Training and Uganda National NGO Forum, 2012).The growth of the internet and mobile devices with quick access to odds has made betting much more accessible.

In particular, sports betting has spread among Ugandan youth like wildfire. Several sports betting companies have recently set up shop in urban and semi-urban areas around the country. Unemployed young people gather at these betting parlors to gamble on things like televised soccer matches. On the weekends, hundreds of sports betting outlets are filled with young gamblers, most of them without any regular income. At the betting parlors in Kampala and its neighborhoods, young men watch soccer matches on flat-screen TVs. Every day, betting companies put a lineup of games for the public to bet on. For every game, there is a team of analysts who analyze the strength and prospects of each team. The stronger the team is, the higher the likelihood of a win but the lower the odds and return. The average bet size is about US$ 0.5. With this information, a prospective wager will place bets and wait for the results. Many unemployed youth are being lured into predicting sports results and placing bets by popular FM radio stations. Youth in the Wakiso and Kampala districts have embraced sports betting for survival because they have no jobs and see this as an opportunity to make some quick money. Majority of the youth interviewed said “I would rather try my luck with betting UGX 1,000 (US$ 0.5) and hope to win and meet my pressing needs than living without any hope at all.” Some say it is a good source of income, but others are not so sure.

Youth viewing match fixtures (Photo by authors)   

Lucrative, Legal Lure
The business of sports betting is give and take. For example, if everybody should bet on Barcelona today and Barcelona loses, betting shops benefit. Conversely, if everybody should bet on Barcelona today and Barcelona wins, betting shops lose while the customers benefit. Betting shops hire young people to work at their branches around the country, thereby creating hundreds of jobs. Although these sports betting operations are legal in Uganda they are not adequately regulated by the government. Before January 2014, there were no clear laws or guidelines to govern gambling in the country. Because of this lack of laws, some companies refused to pay up when somebody won a bet.

Deep Concerns
With the increasing presence of betting shops, some officials charged with youth welfare are very excited and are in agreement with their operation in the country. They argue that they will help to promote the government’s poverty reduction strategy by providing some employment opportunities to the youth. They claim that as more sports betting shops are licensed, more employment opportunities are created in the country. But not everyone agrees that this is a positive thing. Gambling is bad for Ugandan society. This is because the majority of youth are no longer going to school nor seeking gainful employment. They spend the entire day at the betting parlors. Some say the expansion of legal sports betting is fueling vices like the use of tuition fees for betting (among in-school youth); theft and cheating; more illegal street gambling; and sapping young people's motivation for finding jobs.

But back at the betting parlors unemployed youth say that they do not have much choice. They argue that there is no adequate social protection to shield them from the adverse effects of joblessness. They are not betting because they want to bet. Rather they are betting because they want to make a living. Gambling in general and sports betting in particular is growing rapidly, and Ugandan society is sitting on top of a gambling problem time-bomb. Gambling and betting represent new drivers of chronic poverty among Uganda’s youth. Many youth are abandoning participation in productive activities in favor of gambling, especially sports betting. This has emerged as both a rural and urban phenomenon and has increased idleness, diverting would-be productive resources in the hope of winning bets.  There is need for proper regulation of the gambling industry and more sensitization on the dangers of this practice. To address the adverse effects of gambling, Gamble Aware Uganda provides support, information, and advice to anyone suffering from gambling problems. The high unemployment rate among Uganda’s youth poses a serious threat to the country’s well-being.  The unemployed youth are likely to become a source of instability if the government does not plan for them early enough. There is need for urgent intervention to plan for the idle youth population who are likely to become a problem to the country’s security.

Read more in Bruno Yawe and Kizito Ssengooba's Final Report. 

Click here to listen to a radio program on sports betting on Uganda Radio Network in which Bruno Yawe was a participant. The program took place on 10th January 2014 at Makerere University. 

Betting Against the House: Chance, Risk and Fraud

The only all-male panel at the IMTFI focused on risky monetary behaviors.  The presenters led off with a talk about "Gambling and Mobile Money Payments: A Case Study of Sports Betting in Uganda" by Bruno Yawe and Kizito Ssengooba that focused on how value creation and value destruction might be interrelated in the field. They observed that 25% of sports betting shops were licensed (37 out of 104 enterprises) and that mobile money was used for twenty-four hour betting, which was especially popular among working class participants.  (Football was apparently the number one sport for betting activity, according to the researchers.)  

They focused their attention on six online betting shops and on questions about the regulatory environment, the addictive nature of betting, possible links to youth poverty, and mechanisms for redress in rigged and one-way gambling operations.  Some of the most dramatic narratives involved students missing graduation after tuition money had been gambled away.

"Challenges Facing the Uptake of M-Insurance Loyalty Based Life Insurance Schemes: A Case Study of the yuCover Microinsurance scheme in Kenya"  by Nelson Karani Nyachiro and Cyrus Isaboke focused on services offered by yuMobile in partnership with Jubilee Insurance and Micro Ensure,  The yuCover insurance scheme rewarded subscribers with renewable monthly life and disability coverage.  Nonetheless researchers found that belief and culture propagated biases that insurance was for old men and the owners of motor vehicle owners, and even one of the researchers confessed to being among the uninsured.

The final panel on "Automated Teller Machine Fraud in South-West Nigeria: The Shoe-Wearer's Perspective" by Oludayo Tade and Oluwatosin Adeniyi opened with a recap about the fun of participating in a conference in which economists used to crunching numbers could also hear about sorcery and comic books.  Their study focused on the life chances of victims after ATM fraud and emphasized Victims Precipitation Theory (VPT), Lifestyle Theory (LT), and Routine Activity.  The methodology mainly adopted a snowballing approach.  They discovered that the fraudsters identities tended to be kin, lovers, children, and friends, although non-kin third parties could also be victimizers.  Victims often had 2-5 ATM cards and were plagued by illiteracy, illness, or old age and weak constitutions, although even an economics professor had been victimized, according to the researchers.  Despite the protections of PIN numbers and daily limits, there was no shortage of sad story, including the tale of a man who needed help with pushing buttons who was cheated and five young people finishing national service who found their accounts emptied. Such fraud could have particularly destructive effects on students.  It could also lead to business collapse, as well as undermining the entire purpose of saving among community members.  A culture of blaming victim or of officials being unwilling to use footage from CCTV to catch perpetrators could worsen the situations.  It was also interesting to hear about the appropriations and improvisations that banks and users deployed, which included constructing screens to block views of PIN entry.

Discussant Jan Chipchase of frog design asked presenters to reflect about how their own life practices had been changed by their research.  He also pushed the question of whether "exploring topics that are taboo in shape or form or touching on taboo topics" might require researchers "to get participants' perspectives" by joining in  He even suggested that it might be "an obligation to go down that road."

Betting on Chance, a Booklet

by IMTFI researchers Ana Echeverry and Coppelia Herrán

Betting on Chance is the result of a research project that seeks new ideas and answers to achieve financial inclusion by working with and adapting services originally intended for gambling. During research in Medellin, Colombia, we found that people living below the poverty line were using game network operators as a means of conducting their daily financial activities. Network game operators are companies that specialize in managing betting and gambling games through a network of privately owned points of sales as well as affiliate independent sellers. Each seller uses a digital device or point-of-sale terminal for issuing tickets and completing transactions online.

The booklet includes helpful illustrations of the movement of money.

By using video-ethnographic methods, our team of social scientists and designers documented the activities of 21 informants who work in street-sales in the city of Medellin, Colombia. Why, we ask, are these game operators preferable as financial service providers for the poor? What needs do they address? What can mobile money service providers and microfinance institutions learn from these local institutions and practices? Although this study only covered a limited geographic area in Colombia, we believe that the findings and guidelines can be applied in different contexts affected by poverty in this country and beyond. Through an exercise in design thinking, we draw attention to criteria that should be taken into account when developing new products and services aimed to facilitate the use and exchange of money among people with scarce resources.

This booklet seeks to elicit conversations and the exchange of ideas across various fields including development economics and microfinance, social studies of poverty and human centered design. We hope the guidelines outlined in the booklet will help people working in the public, private and academic sectors to design alternative policies and programs to serve the common good.

Our final brochure is available both in English and Spanish.

If you would like to learn more about this project or have any comments, please contact:
Ana Echeverry: Email: anamariaev@gmail.com
Coppelia Herrán: Email: coppe@me.com
www.toca.com