The great growth potential of the Bulgarian iGaming market

While multiple forms of digital entertainment have expanded at dizzying rates, iGaming has emerged as a global powerhouse. Bulgaria is one nation that is establishing itself as a promising player in this sector. I am Michal Kurzanowski, the CEO of OC24 Ltd., and in this article, I will discuss the dynamics of iGaming Bulgaria, looking at its trajectory, potential, and threats. I will also walk you through the nuances of the Bulgarian gaming sector and express my views on the prospects of this region for affiliates.

"Our investigation into the Bulgarian market is based on the recent success of this specific region. Statista predicts that the casino industry market size in the country will continue to grow at an exponential rate. Forecasts indicate that by 2024, the revenue generated by the online gaming sector will reach €134.60 million." — Michał Kurzanowski.

Information about OC24LTD

At OC24 LTD, we take immense pride in being an innovative and progressive business that has been instrumental in the growth of the iGaming market. Young, driven professionals with a love for gaming and betting grace our dedicated team. By pooling our creative energies and in-depth knowledge of industry trends, we strive to relentlessly provide exceptional opportunities for our business partners.

The editorial staff here at OC24LTD and I are extremely passionate and knowledgeable about the gambling industry. We regularly monitor market trends, industry reports, and other relevant gambling news. Notably, OC24 LTD has over 15 projects under its belt, spanning many markets throughout Europe, North America, and Asia. As we work to expand our expertise, we have established ourselves as market leaders in several geographic areas. 

A brief overview of the history of Bulgarian gambling

Every stage of Bulgaria’s gambling history has been a wild dance. Gambling was made illegal here for the first time in the late 19th century. Yet, despite the existence of laws meant to discourage it, the appeal of games of chance and the casino technology Bulgaria hosted persisted, much like a determined gambler seeking a winning run.

• By the late 20th century, a strange scenario had developed: gambling was still going strong, but it had retreated into an underground world unfettered by law and government oversight.
• When Bulgaria rolled the dice and chose to legalize gambling again in 1993, it was a game-changer. The regulations of engagement were not defined and codified into law until 1998.
• With the advent of the Internet, a new participant emerged: the BG online casino industry. The online casino industry brought a new level of play to the table once its legality was certified in 2008, acting as a wild card. However, the legislative framework did not catch up with this virtual tsunami until 2012 to guarantee fair play in the digital sphere.
• Bulgaria rearranged the deck in 2020. The State Gambling Commission stepped down, allowing the National Revenue Agency (NRA) to take over regulation. A new guard had emerged, with the NRA taking charge of the nation’s gaming scene.
• The Bulgarian government acted decisively in 2023 after realizing it needed to tighten control. The formation of an anti-money laundering section by the NRA demonstrated the organization’s dedication to maintaining a clean industry, proving its ability to adapt.
• Another turn of events occurred on April 24, 2024: a bill was introduced to silence the din of gambling advertisements. It was an audacious attempt to change the way people in Bulgaria talked about gambling.

However, the expansion of the market continued unabated in the face of all these regulatory whirlwinds. The gambling sector in Bulgaria was thriving, with an increasing number of gambling operators, sky-rocketing online gambling revenue, and a wide variety of games from worldwide sources. Statistics and figures don’t lie: with an estimated 377,000 users by 2028, it’s clear that games of chance will have a lasting appeal in the digital era.

Current Situation—Revenue statistics and forecasts for 2024

In 2024, the gambling sector in Bulgaria is expected to bring in BGN200 million, or €102.3 million, to the national budget, as reported by iGB. The country’s National Ministry of Finance arrived at this estimation. If Bulgaria wants to attain its goals, it needs substantial financial investments.

Source

By 2029, the predicted market volume for gambling in Bulgaria is US$186.20m, reflecting a compound annual growth rate (CAGR) of 4.80% from 2024 to 2029. Our expert analysis below gives you a brief overview of the upcoming trends in the following areas of the Bulgarian iGaming sector -

1. Consumer Preference: Because of its accessibility and ease, internet gambling has shown a high preference among Bulgarian customers. The convenience of being able to play whenever and wherever one wants is a big reason why online gambling has become so popular, and the increasing use of smartphones is just one more reason. Brands and clients seeking diversity and enjoyment have been drawn to the abundance of games and betting opportunities.
2. Sports Betting: The rising popularity of sports betting is a major trend in Bulgaria’s online gambling sector. The increasing demand for sports betting in Bulgaria may be attributed to the country’s passionate sports fans, especially those who love football. This market subsegment has grown even faster because of the advent of live betting options, which allow punters to wager on games while they are happening live.
3. Online Casino Sites: While sports betting is still the most popular kind of online gambling, online casino Bulgaria websites have become more widespread in recent years. The influx of internet casinos providing games like slots, roulette, and blackjack has contributed to this trend in Bulgaria. A large number of players have shown interest in playing casino games online because of the ease of access.
4. Local Laws: The government of Bulgaria has passed laws to protect the integrity and transparency of the country’s online gambling industry. Reputable operators have joined the market, and consumer confidence has grown as a result. Online gaming providers are subject to the licensing process requirements that stringently demand they follow responsible gambling practices and fulfill certain criteria.
5. Economic Factors: The expansion of the digital gambling industry in Bulgaria is at least partially attributable to the country’s improving macroeconomic situation and rising per capita income. The desire for online gambling has risen in Bulgaria due to the country’s increasing internet penetration and disposable incomes. There has been an influx of capital into the sector thanks to the country’s welcoming tax policy for online gaming platforms.

Overall, the rise of online casinos, the prevalence of sports betting, the desire to play at every mobile casino Bulgaria has to offer, and the need for variety and convenience have all contributed to the explosive expansion of Bulgaria’s online gambling sector. Additionally, the market’s growth has been aided by the attractive tax system and stringent regulations. The online gaming industry in Bulgaria is anticipated to maintain its rising trajectory as economic activity and disposable incomes continue to expand.

Problems and challenges faced by Bulgaria’s gambling market

In recent years, the gambling sector has contributed about 3% to 4% to the country’s GDP. The projected number of casino slots that players have access to throughout Bulgaria is around 6,000. Despite the active development of Bulgaria’s gambling market, the authorities are facing important challenges that need to be addressed correctly and on time. We discuss some of them below:

Tightening Regulations in Bulgaria

Only operators with the proper licenses are permitted to offer any form of online gambling service, with an exception for instant lotteries and raffles. The minimum age to participate in gambling practices in Bulgaria is 18 years. This is a sign of Bulgarian regulation tightening up since the state has a monopoly on all traditional lottery games, but bingo and keno are not included in this. At present, the National Revenue Agency oversees and regulates the industry under the Gambling Law of 2012. Providers are not restricted in the number of licenses that they can acquire. License charges start at a minimum of €55,000 and can be far over €70,000, depending on the kind of permit. The operator’s initial investment in the state determines the validity of the license, which might be five or ten years. To launch an online casino in Bulgaria, the minimum required initial investment is about €300,000, while betting shops are required to make €500,000. All operators are also required to have a collateral of €500,000.

Taxation and Anti-Money Laundering Policies

A flat tax of 15% is applied to all operators. Twenty percent of the gross receipts go toward license renewal fees as the income tax rate increased from 15% in 2023 to 20% in 2024. In 2020, the State Gambling Commission was disbanded due to corruption allegations; the NRA is now in charge of gambling in Bulgaria. The Anti-Money Laundering Unit was also formed in 2023. Its purpose is to guarantee that all necessary procedures are followed, including the gathering of documents, verifying customers, and developing risk assessments for money laundering and terrorist funding. In addition to sharing data with foreign authorities, it will keep tabs on suspected clients, transactions, and activities.

Source

Banning Gambling Ads in Bulgaria

In this section, I’d like to point out that in April of 2024, a bill was introduced that, if passed, could ban almost all gambling advertisements in the country. The purpose of the bill is to revise Bulgaria’s Gambling Law. According to the proposal, ads for gambling would no longer be allowed to air on television, radio, a website, or print media. It would also be illegal for buildings to display advertisements.

The goal of this policy is to ban gambling ads and protect vulnerable populations from exposure to potentially harmful forms of entertainment. Casinos in small towns (with populations of up to 5,000) would be prohibited from offering slot machines and gambling, and websites hosting illicit games would be blocked as well. This would mean a direct ban on slots in less-populated areas. An increase to the minimum capital requirement for slot machine licensing applications is also being considered. The increase is set to range from 500,000 to 750,000 BGN.

I think that severe advertising bans might have unintended consequences, which is something to keep in mind. To encourage responsible gambling, it would be more effective to impose stricter standards on the content and quality of advertising.

Gambling Addiction

About 3% of the Bulgarian population struggles with compulsive gambling. When a player develops a gambling addiction, it can have devastating effects on their professional and personal lives. So, it’s in everyone’s interest to influence gaming norms and educate the public about the dangers of gambling addiction. The widespread stigmatization of gambling might potentially increase its appeal to vulnerable populations. Hence, it is essential to bolster self-control methods, control the quality of advertising (as previously discussed), improve services for those in need of assistance, and engage in educational activities with the general public.

To sum it up–Great growth potential attracts new partners to the Bulgarian market

Looking back on the fascinating and turbulent history of Bulgaria’s gaming scene, I am struck by one word: potential. The data presents a clear image of a promising market where new regulations and industrial developments lead to increased profits. The entry of additional licensed operators year after year is indicative of a developing and maturing sector. Gambling in Bulgaria looks promising for the future, with both operator counts and revenues on the rise. It’s important to highlight that Bulgaria is a very desirable Tier 2 market, offering plenty of chances for effective advertising and interaction. If done correctly, reaching out to this market has the potential to be very profitable.

One thing is very evident as our team keeps an eye on the Bulgarian gaming industry’s progress: this jurisdiction has tremendous opportunities for lucrative collaborations and projects. We are prepared to navigate this ever-changing terrain and take advantage of its prospects by keeping vigilant tabs on market trends and changes in regulations.