This youth month, the FSCA is warning the youth about the dangers of gambling which can turn into an addiction and has catastrophic ripple effects on families due to financial losses.
The South African betting industry, encompassing sports betting and online casinos, has seen its revenue increase from R8.8 billion during the 2019/20 financial year to R23.7 billion in 2022/23. The skyrocketing profits from these platforms are happening against the backdrop of increasing unemployment rates, of which 50% are amongst the youth, and an increasing cost of living for South Africans.
While gambling can be a legitimate recreational activity, its rapid growth and potential negative impact on youth in South Africa in particular, emphasize the need for awareness, regulation, and preventive measures.
According to infoQuest, a South African online research company which recently conducted a survey amongst 300 gamblers (18 – 34 years), during March 2024 notes that Lotto is the most popular form of gambling in South Africa, followed by online gaming and sports betting. With a strong sporting culture of various sports for rugby, cricket, and soccer, South Africans are increasingly using online betting platforms to place bets on their favourite teams.
The FSCA’s Financial Literacy Baseline study indicates that 37% of South Africans feel that risk-taking is an important part of their lives, with 32% willing to take risks if they can make money. The study further found that 25% took risky financial decisions. Young people, often drawn by the prospect of quick financial gains and the excitement of risk taking, increasingly engage in gambling activities. Unfortunately, this trend can lead to addiction, financial instability, and adverse effects on mental health and academic performance. Ultimately, you will lose money when gambling.
What are the dangers of gambling?
Gambling often leads to increased gambling and losses. It is a never-ending cycle of chasing the thrill of winning, but also about chasing your losses.
If you finance your gambling activities through credit card or loans, it could have a negative impact on your credit score and negatively affect your chances of securing credit at a good interest rate.
People also borrow from loan sharks otherwise known as ‘mashonisas’ to gamble, landing them deeper into debt traps.
Gambling addiction, like all addictions, affects family, friends, and broader social networks. Addiction thrives on secrecy, and many people keep their gambling habits a secret because of feelings of shame. Shame and secrecy often exacerbate the problems and stops people from getting the help they need.
Not getting help for an addiction or compulsive gambling often leads to low self-esteem, stress, anxiety, and depression.
How to avoid becoming a compulsive gambler.
- If gambling is recreational, set a limit and stay within that limit. It is extremely easy to overspend, max out your credit cards, and then have to deal with the problem of being unable to pay it back.
- Don’t gamble with debt. Avoid taking out loans or credit cards to gamble.
- Strictly limit your gambling time.
- If you engage in gambling, set clear and attainable short and long-term goals to help you cut down and eventually give up gambling.
Find alternatives to gambling that include healthy and engaging activities with loved ones to help you keep your mind off gambling.
PERSONAL FINANCE