Cash Raffle Thrives Amid Strict Law

Kedir Nesredin, whose name has been changed upon request, arrived early morning on March 21, 2018, in Merkato the largest open market in Addis Abeba, wearing a brown gown.

He stepped aside from the road, placing his mini pad under his armpit, hunting for a free spot from the busiest place in the city, Merkato, to fasten his shoes.

As he casually does, he started to announce the launch of the registration to the day’s cash raffle to his patrons. Then, Kedir, who has been in the business for the past three years, started walking around and collecting money from his customers whose daily business is waiting for him.

He usually registers a maximum of 100 individuals in order to hold a raffle which awards prizes to winners, cash, shoes, audio players, household utilities and different materials.

Kedir registers the name of players who bought the tickets for 50 Br, listing their names as they buy using consecutive numbers. He registers the ticket number in his notebook, starting from the first buyer to the last. Players are given a chance to choose their lucky number unless it is picked by someone who registered earlier.

After completing the registration, the drawing of the lottery is held in public, three people who are not part of the game are selected to facilitate the drawing and witness the transparency of the drawing process, the host is not involved in the process.

Biniyam Amede, a young man, is one of Kedir’s regular customers. Owning a retail shop in Merkato, Biniyam plays the lottery game that Kedir hosts every morning.

He was one of the luckiest winning, one of the morning raffles, a lottery game worth 3,500 Br. One of the witnesses had picked his lottery number from a container that holds the copy of every ticket Kedir sold that morning.

Although the legal framework for operating raffles, casinos and other gambling establishments exists, gambling is not as widespread in Ethiopia.

“I regularly play the raffle with my friends,” Biniyam told Fortune.

Including Biniyam, Kedir awards three of his players, who won the game, with 3,500 Br, 200 Br, 100 Br respectively. Out of the 5,000 Br he collected, he deducts 24pc of it amounting to 1,200 Br as a commission and service fee.

Although the legal framework for operating raffles, casinos and other gambling establishments exists, gambling is not as widespread in Ethiopia. However, these days these raffles are becoming popular in the capital specifically at the vibrant marketplaces such as Merkato.

Many individuals who are attired in gowns walk here and there inviting the retailers and buyers in the marketplaces to take part in the raffle. Such games in Merkato have a minimum of 300 Br and a maximum of 500,000 Br prizes.

In the previous years, the number of people who held raffles was very few, according to Biniyam, but these days the number has increased drastically.

Even though the trend has recently became popular in Addis Abeba, it is common in other African countries such as Kenya, Uganda, and Ghana, which legalised online and offline betting. However, other African countries such as Sudan, Algeria and Tunisia actively forbid any form of gambling practices.

Kenya had legalised gambling since 1966, with a minimum gambling age is of 18.

Unlike these countries which legalise the raffles, individuals such as Kedir in Ethiopia are holding the game without a license from the National Lottery Administration (NLA). NLA, which was established in 1961 and reorganised in 1981, has the lonesole authority to issue and withdraw permits, as well as to collect the licensing fees. It currently regulates and controls all gambling-related activities.

Notwithstanding, the Administration does not have a plan to permit private businesses in the country to hold lotteries and raffles.

The Administration is also mandated with selling lotteries and collecting a taxes from lottery owners, on behalf of the Ethiopian Revenue & Customs Authority (ERCA). Lottery winners over 1,000 Br are subjected to pay 15pc tax.

“We have recognised that individuals, who illegally hold raffles, are mushrooming in the capital,” said Tewodros Neway, head of the public relation unit at the Administration, which netted 89.6 million Br during the first six months of the current fiscal year.

“Our control team is working on an investigation to take them to court,” he added.

When an individual is caught for holding raffles illegally, the person will be subjected to three to five years of imprisonment with up to 100,000 Br monetary fine, according to the establishment proclamation of the Administration.

“Since last month, we have started issuing warning letters to the suspected individuals uttering them to refrain from their acts, before taking them to court,” Tewodros said.

But this does not seem effective as different individuals are seen in the major marketplaces of the city inviting individuals to take part in the raffle.

Gashaw Arage, 26, is another individual who runs his life from the revenue he generates from this business based at Shola Market in Bole District.

“I would be happy if I am able to get a license for the business,” he told Fortune.

Notwithstanding, the Administration does not have a plan to permit private businesses in the country to hold lotteries and raffles.

“We don’t have a plan to issue a license for private businesses to engage in cash raffles,” said Tewodros.

The Administration issued 87 licenses to different organisations to run a promotional lottery, given to companies for promoting their businesses such as banks; Tombola lottery is allowed as a fundraising method, for instance raising funds for the Great Ethiopia Renaissance Dam (GERD); conventional bingo, allowed for government institutions and labour unions, and sports betting.

Out of the total licenses, 10 of them were issued for betting companies, which payout cash for bettors whose team won. The payout varies depending on the odds given by the platform of the betting company. The odd allows the competitors to calculate the winning amount on the bet. The Administration shares 15pc of the companies’ profits as a royalty fee.

Beyond taking actions on the individuals who hold the raffles, the administration also targets individuals to stop such lotteries.

“We are preparing different seminars to create awareness to those individuals especially in areas where the raffles are held widely,” Tewodros said.

But Kedir and Gashaw, seem happy with their business which is easy and has a quick return until the inspection team of the Administration catches them.


By Solomon Yimer



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