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Limited Payout Machines

As defined in the NGA, a ‘‘limited pay-out machine’’ means a gambling machine with a restricted bet and prize.

The main role players in the LPM sector can be defined in three specific categories, namely route and independent operators, site operators and the National Central Electronic Monitoring System (NCEMS). Route/independent operators are companies that are licensed to own, manage and operate LPMs throughout the country. Site operators are privately-owned hotels, pubs or eating establishments, totalisator or bookmaker outlets which may be situated throughout the country. NCEMS is a centralised LPM monitoring and evaluation system operating on a long-term contract basis by Route Monitoring.

The total number of licensed route/independent operators is reflected per province in table 6. This includes route operators operating in more than one province. During FY2020/21 and as at 31 March 2021, Vukani Gaming operated in all nine provinces; Goldrush Gaming operated in six provinces (Gauteng, KwaZulu-Natal, Limpopo, North West, Northern Cape, and Free State); Grand Gaming operated in three provinces (Gauteng, Western Cape and Mpumalanga); Crazy Slots and Hot Slots in Gauteng; Kingdom Slots, KZN Slots, Luck@it and Great Bingo in KwaZulu-Natal; Varloflash, Tshufi Gaming, I Slots, Vegas slots and Magic Slots operated in North West; Pioneer operated in Eastern Cape and an independent operator was also operational in Mpumalanga.

The regulations on LPMs anticipated a roll-out of 50 000 LPMs in South Africa. This was to occur over two phases, the first being 25 000 machines. On 20 June 2003, the first LPM site was established and operated in Mpumalanga. Similar to the rapid development of the casino industry in its early years, growth in GGR in the LPM sector is largely a function of the roll-out of machines, as shown in the graph below. The number of operational LPM site operators as well as the installed LPMs and active LPM for FY2020/21 is illustrated on the table below.

The LPM sector maintained a positive growth trend with growth in the gross gambling revenue (GGR) generated by the sector increasing annually as illustrated on the graph below. GGR increased by 14.1% between FY2015/16 and FY2016/17, followed by an increase of 9.8% between FY2016/17 and FY2017/18, increased by 13.2% from FY2017/18 to FY2018/19 and increased by 9.9% in FY2019/20. The GGR generated by the LPM sector during FY2020/21 was R2.4 billion, a fall by over a third (33.9%) from the previous financial year FY2019/20 (R3.7 billion) owing to the effects of the Covid-19 pandemic. GGR generated in the LPM sector represented 10.5% of the total amount of GGR generated by all licensed gambling modes in FY2020/21.