China’s online lottery suspension leads 500.com to buy payment processor

China’s lottery business continued to contract in October, with welfare lottery sales declining faster than the sports lottery.

The Ministry of Finance announced this week that October’s lottery sales fell 4.5% to RMB 31.2b (US $4.9b). Welfare lottery sales were down 8% to RMB 16.3b while sports lottery sales dipped a mere 0.3% to RMB 14.9b. For the year-to-date, total lottery sales are down 2.9% to RMB 303.1b ($47.4b).

Last year saw a spike in sports lottery sales due to the 2014 FIFA World Cup and China’s economy has since gone south, so 2015’s numbers were expected to look bad by comparison. But this year also saw the ‘temporary’ suspension of online lottery sales after an internal audit uncovered widespread corruption at provincial lottery administration centers.

This ‘temporary’ online suspension has now lasted nine months and there’s no end in sight. The lack of online sales has played havoc with the business of Shenzhen-based 500.com, which has reported zero revenue for two straight quarters following the shutdown.