Despite being a predominantly Muslim nation, Malaysia has a thriving economy and is becoming increasingly attractive to foreign investors due to its diverse population and advancements in technology. As such, there is still ample opportunity for the growth of the gambling sector.
Malaysia’s laws regarding gambling
Malaysia, a predominantly Muslim country, allows various forms of gambling despite its religious affiliation. Lotteries were legalized in 1952 under the Lotteries Act, followed by horse racing in 1961 via the Racing Act. However, sports betting remains prohibited under the Betting Act of 1953. Although land-based casinos are technically regulated, there is currently only one licensee, resulting in a de facto private monopoly.
In the internet age, Malaysia’s gambling laws have not been updated, and while there are no laws governing online gambling operations, the government can block platforms within the country’s borders and prohibit Muslim citizens from playing.
In January 2023, the northern state of Kedah prohibited 4D lottery sales points and immediately revoked licenses, leading to criticism that foreign investors would be driven abroad, and players would resort to illegal options. The government responded by arresting over 900 individuals associated with illegal gambling across the country and confiscating MYR20,984 ($4,915).
Despite their efforts, the government may not have the necessary technological expertise to effectively monitor and control online gambling. Many believe that regulation would be a wiser choice, especially when considering potential tax contributions. In 2021, the government developed a new licensing system for online operators to replace the 1953 law, and discussions continued in 2022.
Currently, the only licensed gambling establishment in Malaysia is Resorts World Genting, located in the Genting Highlands Resort. However, Malaysian Muslims are prohibited from entering in accordance with their religion. Despite conflicting attitudes towards gambling, it remains popular and is met by foreign brands, given the absence of modern technology legislation, cultural acceptance, and a wide selection of foreign-based online casinos and bookmaker platforms. Overall, Malaysia has a developed but somewhat ambiguous gambling market.
Market demand in Malaysia
The enthusiasm of Malaysians for sports is evident in their gambling habits, which they indulge in despite the legal restrictions. Popular sports for betting include badminton and football, including European events such as the English Premier League, as well as local favorites in the Super League. Motorsports are also a hit, with Malaysia hosting the Formula One Grand Prix and the Motorcycle Grand Prix World Championships.
Apart from sports betting, Malaysians also have a fondness for slots, poker, and live dealer alternatives to real casino games, which are not legally available to the local audience.
Horse racing is both legal and well-liked. However, the same cannot be said for the lottery, which used to have over 680 shops offered by the Sports Toto, a 4D (four-digit) lottery operator. This vertical faced significant government opposition earlier this year.
Demography of Malaysia
Malaysia boasts a diverse population, with a melting pot of different cultures and ethnicities. Of the country’s 34 million people, nearly 70% fall under the category of bumiputera, which includes various indigenous cultures such as Malay, while 20% are Chinese and 6% are Indian. The country has 134 languages, with Bahasa, English, Chinese, Tamil, Telugu, Malayalam, Panjabi, and Thai being the most commonly used ones. While the majority of Malaysians practice Islam, there are also significant populations of Buddhists, Christians, Hindus, and other religions.
The people of Malaysia are mostly young and tech-savvy, with only 8% of the population being 65 or older. A staggering 97% of Malaysians use the internet, and mobile devices are a popular means of accessing it, with 141 mobile subscriptions for every 100 people.
The local currency in Malaysia is the Malaysian Ringgit (MYR), although the USD is also commonly used. In addition to traditional credit and debit cards, popular payment gateways such as PayPal, Neteller, Stripe, Worldpay, and iPay88 are widely used by locals. Mobile payments are also popular, with options like GrabPay, Boost, and Touch ‘n Go gaining popularity. Cryptocurrency is also widely used, with 15% of Malaysian internet users owning some form of it.