Up to 41% of Low-Income South Africans Gamble to Pay Bills

Experts in South Africa are sounding the alarm, saying that many low-income people, as much as 41% of them, turn to gambling in an effort to pay bills and rent. They suggest a combination of stricter rules and educating the public in order to stop the concerning trend.

A Large Portion of South Africans Are Gambling to Pay Bills

In a recent interview, Matsaung Thabo Hollo of Old Mutual, a seasoned social impact practitioner with over 20 years of experience within the financial services industry, talked about the rising number of lower-income people who gamble in order to pay life expenses. In the interview, Hollo and his host, Wasanga Mehana, discuss how each year, South Africans spend approximately R1 trillion ($55 billion) on bets, with sports betting accounting for R700 billion (around $38 billion) of that total. Nearly 41% of low-income earners, those earning between R8,000 and R15,000 ($442 to $829) per month, resort to gambling in an attempt to meet their basic living expenses.

This often leads to a vicious cycle of debt, poverty, and addiction. Young men in South Africa are especially vulnerable to the surge in online sports betting. According to Hollo, the growth of online gambling has made the issue worse by providing people with constant, unrestricted access.

Hollo’s words are supported by John Manyike, the head of financial education at Old Mutual. According to him, there is a significant emotional impact of gambling, noting that excessive gambling is becoming a widespread issue. He points out that it inevitably leads to financial strain, particularly among those already under pressure, as many continue to gamble in an attempt to recover losses from previous bets.

Manyike also references reports of individuals committing suicide due to substantial gambling losses. Manyike highlights that gambling can result in the loss of family relationships and may drive some people toward substance abuse and other harmful behaviors, demonstrating the profound emotional and financial damage gambling can cause.

Why Are So Many choosing to Gamble Away Their Meager Income?

According to Manyike, a major issue is how many people overestimate their chances of winning big, which contributes to the problem. He points out that the structure of betting odds is designed to ensure bookmakers maintain their profits. Bettors often believe they have a better chance of winning than they actually do.

In reality, there is a built-in disadvantage within the system, which is fundamentally designed to favor the house. However, the persistent fantasy of suddenly waking up a millionaire keeps drawing people back to gambling repeatedly.

What Can Be Done?

Manyike explained that the solution to this issue is to educate the public while also having stricter rules for gambling advertising and licensing. In addition, he thinks that gambling operators should allocate a specific percentage of their profits toward awareness campaigns. These initiatives would not necessarily need to be conducted by the operators themselves but could be managed by independent organizations, NGOs, or in collaboration with government agencies. The goal would be to effectively raise public awareness about the risks associated with gambling and to promote responsible gambling practices.