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Lottery hopes to soar on Wing network

Content image - Phnom Penh Post
A poster advertises Mohaleap Lotto outside a Wing agent office in Phnom Penh yesterday. Hong Menea

Lottery hopes to soar on Wing network

Mohaleap Lotto, a subsidiary of Cambodia’s Royal Group, officially entered the Kingdom’s lottery gaming market this month, hoping to disrupt a business sector currently dominated by black market outlets, a company executive said yesterday.

Phong Van Harch, the firm’s chief operating officer, said that since Mohaleap’s launch on May 2, more than 100 customers have won the lottery, while thousands play daily. He said the lottery business in Cambodia offers a lot of promise, particularly due to the popularity of gambling in the country, though the market is already crowded with both licensed and illegal lottery businesses.

Van Harch said the new lottery firm will rely on mobile money operator Wing Specialised Bank, another subsidiary of Royal Group, for its points of sale, leveraging the firm’s 5,000-strong nationwide network of agents to gain an advantage over its competitors.

“At the end of this year, we will become the leading lottery company in Cambodia because we have the biggest selling network in the country,” he said.

“We have a strong competitive advantage because Wing’s agents are found nationwide and people trust their service. It is very convenient for players, who can buy lottery tickets from any Wing agent, and if they win, they can claim the award from those agents as well.”

Prices start at 1,000 riel ($0.25) for a single six-digit bet and the maximum payout for winning tickets is 300 million riel ($74,000). There is a maximum of 12 bets per ticket and the lottery results are drawn daily live on Cambodian television channel CTN – which also belongs to Royal Group.

According to Van Harch, lotteries are popular in rural areas, but players often bet from illegal outlets. He added that if the government can successfully regulate the lottery market so that all players gamble with licensed companies, it would generate at least $3 million a year in tax revenue.

Van Harch did not disclose the firm’s startup capital investment. However, a licensed lottery company is required by law to have at least $2.5 million in capital and pay a monthly 10 percent tax on revenue, according to Ros Phirun, deputy director of the Financial Industry Department at the Ministry of Economy and Finance (MEF).

Firms are also required to maintain a $500,000 reserve deposit with the National Bank of Cambodia and pay an annual licence fee of $10,000, he said.

Phirun confirmed that Mohaleap Lotto, which is legally registered as Every Bright Trading Co Ltd, was officially licensed by the government as a subsidiary of the Royal Group.

So far, a total of nine lottery firms have registered in Cambodia, with Phirun saying that if properly managed and regulated, the sector can have a positive impact on the country. He observed that many other countries had their own lottery industry, including the US, Japan, Vietnam and Thailand.

“Everyone has a chance to be lucky so we decided to allow for the legal operations of lottery businesses,” he said.

“Players can bet small amounts of money to buy lottery tickets and sometimes, if they win, it can change their life.”

However, Son Chhay, lawmaker for the opposition Cambodia National Rescue Party, said that all gambling businesses in Cambodia – including casinos and lotteries licensed by the MEF – are technically illegal because the law on gambling has never been approved by the National Assembly. He added the sector was harmful to the wellbeing of the Cambodian population.

“The lottery business is just operating to collect money from poor people to put into the pockets of businesses,” he said.

“We should instead encourage more investments for food processing plants in order to boost the demand of farmer’s agricultural crops and create higher prices, which will create a bigger benefit for peoples’ incomes.”

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