Strict. Expensive. Complex. Is the German online gaming market even worth entering? IDnow’s VP of Global Gaming joins other industry experts to explore the state of play in what could be the European country with the most untapped potential.
When compared to other European countries, Germany’s online gambling market is in its infancy, still taking its first steps. In fact, it was just July 2021 when the Glücksspielstaatsvertrag (German Interstate Treaty on Gambling) came into effect, which effectively legalized and regulated it across all 16 states.
Four years later, the industry is worth about €3 billion per annum. Although certainly a decent amount, when compared to more mature markets like the UK, which generates around €8.3 billion of annual income, it is rather underwhelming, especially considering there are 15 million more people in Germany than the UK.
Reasons for Germany’s sluggish growth in the online gaming market range from low deposit limits, heavy advertising restrictions, major compliance burdens, and, of course, the struggle to tempt players away from the black market, which still remains incredibly popular in the country.
Interested in how Germany is attempting to tackle unregulated gambling, read our ‘Exploring black market gambling in Germany’ blog.
In February 2025, to explore the challenges facing operators, and share strategies on how to capitalize on the complex but lucrative market, Roger Redfearn-Tyrzyk, VP of Global Gaming at IDnow attended a webinar with Dimitry Voelkle, Managing Director at Zelda Consulting GmbH and Faruk Aydin, Chief Revenue Officer at the Revpanda Group.
Missed it? Don’t worry – here are our top 3 takeaways:
1. Strict regulations can be both a blessing and a curse.
If you want to become a major player in Europe, it’s essential to have a presence in Germany. However, it’s safe to say that that won’t be easy. In fact, there are many German regulations and requirements that could put operators, especially international operators, off.
I always say that regulation is good if the regulation is good. The fact remains that in 2007, 55% of the German population gambled but that figure dropped to 30% in 2021 following the introduction of regulations. The German regulator must ask itself why this happened.
Roger Redfearn-Tyrzyk, VP of Global Gaming at IDnow
There is a long list of requirements that operators must follow to become a licensed gaming operator in Germany. For example, besides ensuring onboarding and registration processes comply with strict BaFin AML directives, operators must also obtain an annual ISO 27001 security audit certificate. Further requirements include needing to be headquartered in Germany and have German language proficiency to fill out license applications in the native language. Other potentially off-putting stipulations include:
Deposit limits: Players are only able to deposit a maximum of €1,000 per month across all licensed platforms.
Stake limits: Players can bet a maximum of €1 per spin on slots and must wait 5 seconds between spins.
Game restrictions: German players that have migrated from unlicensed platforms – of which there are still millions – may find their favorite game unavailable as live casino games, progressive jackpots and live bets are all prohibited on regulated platforms. Not being able to offer players their favorite game is, of course, an additional challenge for operators.
Advertising: Operators are subject to very narrow windows within which to advertise. No ads can be broadcast between 6am-9pm on TV, radio or any other medium. Influencer marketing is also prohibited, as are ads that target minors or other vulnerable groups.
Discover more about German online gambling regulations in our blog, ‘Online gambling in Germany: Regulations, restrictions, and ramifications.’
Gambling regulations 101: Europe and the UK.
Discover how gaming operators can keep pace with the ever-growing multi-jurisdictional landscape in Europe and beyond.
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2. Money’s too vast to [not] mention.
There is one thing that prospective operators need in abundance before they begin their German gaming journey (besides patience!): money.
After paying a non-refundable application fee of €185,000 to the Gemeinsame Glücksspielbehörde der Länder (GGL), operators can gain a license, which is typically valid for 5 years, but can be renewed for 7. However, the financial outlay doesn’t stop there. German gaming operators are also required to pay a so-called ‘security deposit,’ which acts as a bank guarantee to protect player funds. Based on the operator’s projected monthly turnover, this can range from the minimum of €5 million to €50 million.
It doesn’t stop there. Alongside the tripling cost of player acquisition, there are annual supervisory fees, which operators must pay to cover GGL’s regulatory oversight and additional compliance costs like connecting to the ‘limit control database’ to enforce the €1,000 monthly deposit limit, among others.
Lastly, operators are subject to quite high taxes, with a 5.3% stake tax applied to every single euro wagered. In a bid to offset these costs, many resort to lowering the ‘return-to-player’ percentage (the amount paid back to players).
However, with a population of over 84 million and vast numbers of the public still using black market platforms, there is clearly opportunity for those that a) have the patience and money to enter and b) can tempt black market players to the regulated environment. But how exactly can operators do that?
3. Always room for something new and novel.
There are still opportunities in the German online gaming market, especially for those that can offer something different to underserved demographics, such as the younger (20-30 years of age), multicultural generation.
This is because much of the current marketing – and available games – cater to an older audience. So, if operators can offer the games that people want to play (e.g. Book of Ra), and a simplified, compliant user experience then there are valuable opportunities to capture the attention of a new generation of Germans.
“At IDnow, we see compliance as an enabler not a burden. One of the major reasons we offer player feedback surveys after every verification is to discover what players value, which then informs the tweaks we make to the user experience and subsequent player education. Through player feedback, we learn whether more instructions are required and gather opinions and issues with the design and UX etc,” said Roger.
As Germany is such a comparatively young market, creating an environment that is attractive to the players, operators and the regulator requires open and transparent dialogue about how to take the market forward.
Click below to watch the full session:
For a deep dive into the compliance challenges facing global operators, including analysis of some interesting regional differences, read our ‘Exploring the gambling industry’s top compliance challenges in 2024 and beyond’ blog.
Learn more about how our identity verification solutions can help maximize conversions while fighting fraud in the Gaming industry.
By
Jody Houton
Senior Content Manager at IDnow
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