Online gambling in Germany is posed to enter a period of massive growth. Following the introduction of new regulations around online gaming in 2021, remote sportsbooks and online casino operators can now apply for licenses across the country. This will provide them with access to millions of potential gamers in the country with Europe’s largest population.
If your company works in the online gaming industry and you are interested in expanding in Germany, it is helpful to get a feel for the size of the country’s market and growth potential. Xace has compiled a comprehensive list of Germany’s online gaming statistics in 2022.
Understanding Germany’s online gambling rules
On 1st July 2021, all 16 German states agreed to regulate online gaming in the country. The exception was the state of Schleswig-Holstein in the north of the country. Schleswig-Holsteinhad previously permitted iGaming for several years, and had issued licenses for about 50 online casinos, sports betting sites and poker rooms.
Germany's new online gaming rules are certainly welcome news for the gaming industry, since it will provide a lot more clarity. Nonetheless, the process of applying for a licence appears to be fairly complex and slow so far. The rules also require gambling websites to ensure that all games comply with strict rules. Many will have to adjust their back end technology to avoid potential addiction risks. Some of the rules include:
· Setting a EUR 1 maximum wager on online slot machines
· Preventing players from spending more than EUR 1000 per month
· Restricting many forms of advertising
How big is Germany’s online gambling market?
Because online gaming has only recently been regulated in (most of) Germany, definitive statistics on the market are hard to come by. Many German online gamers would have previously been taking part in unregulated iGaming – betting via foreign websites that accepted German players. Still, we can gain some insights into the size of the country’s market by analysing the data.
Reports show that Gross Gaming Revenue in Germany in 2018 was EUR 14.2 billion, including land-based gambling. A different 2019 European Gaming & Betting Association (EGBA) study found that about 19% of the country’s gaming happens online. That suggests a GGR of EUR 2.7 billion from online gaming.
Breaking this down into different types of gambling is challenging, but one recent study estimated that revenue from Germany’s online casinos was EUR 2.2billion in 2019 (and this is expected to rise to 3.3 billion euro's in 2024). That suggests that most of the country’s iGaming happens in online casinos(rather than sportsbooks or poker sites).
But of course, we need to take these estimates with a pinch of salt since most iGaming was not regulated until last year and the true levels could be wildly different. Indeed, one estimate for the size of the country’s non-regulated online gaming sector put it anywhere between EUR 4 billion and EUR 22 billion – a huge margin of error!
Another way of trying to ascertain the size of Germany’s online gambling market is to look at how much Germans spent as a proportion of all online gambling in Europe. According to the EGBA study mentioned above, Germans were responsible for 11.4% of online gambling spend in Europe in 2019. A total of EUR 24.5 billion was spent in online gaming that year in Europe (including the UK) - which would suggest that Germans spent about EUR 2.8 billion on iGaming.
Germany online gaming tax
Germany taxes different kinds of games of chance in different ways:
· There’s a 5% tax rate for online sports betting
· Online slots and poker sites pay a 5.3% tax
· For online casinos, there’s a 19%tax on gross gaming revenue
Players are not taxed on winnings in Germany. They must be aged 18 or over (and 21 in some federal states).
Recommended: UK online gambling statistics
Who gambles online in Germany?
Since 15 out of 16 German federal states outlawed the provision of online gambling until last year it is somewhat challenging to estimate how many Germans gamble online. But again, we can make some informed estimates.
Data suggests that 75% of Germans have gambled at least once in their lives. As noted above, about 19% of Germany’s gambling happens online. In a country of 83 million people, where 75% of the population has gambled at least once, we can speculate that around 12 million Germans have gambled online.
Surveys of online gambling behaviour (both legal and unregulated) gives us a slightly clearer idea of the demographic characteristics of German gamers:
· 70% are male
· 70% are aged between 25 and 44years old
· 93% say slot machines are their favourite games
· Two thirds gamble daily
· Almost half spend less than EUR20 per visit
· The majority of online gamers spend less than EUR 50 per month on online gambling
· People in northern Germany gamble online significantly more than those in the south
· The smartphone is the most popular way to gamble online in Germany
When it comes to online sports betting, evidence suggests that the most popular sports, in order, are:
· Horse racing
· Ice hockey
Related: Malta online gaming statistics
An exciting future for online gambling in Germany
With new laws regulating online gaming in Europe’s biggest economy, 2022 could be a very exciting year for businesses to tap into this market. And, for international online gaming businesses, applying for a local license could be smart move – one survey found 62% of German players would rather bet with a locally-licensed operator than continue gaming on foreign sites.
If you are looking to set up an igaming business, an online casino, betting site or a sportsbook in Germany, you will need a way to accept payments from customers in the country and make payments to your business partners.
Xace is an payment institution that provides digital business accounts for online gaming firms. While Xace is not a bank, it delivers many of the key features you would expect from a banking solution, and our business accounts are tailored to the needs of the online gaming industry.
If you are applying for an online gaming license in Germany, opening a Xace account will allow you to begin receiving and making payments. To learn more, read about our Germany online gambling business accounts.