MyLotto24, owned by the Frankfurt-listed Zeal Network, will launch on Friday and announce it has struck a partnership with the Victorian Newsagents’ Association.

The timing of the company’s launch has been met with raised eyebrows in the gambling industry.

It comes as the federal government remains steadfast in its commitment to pass legislation banning the provision of lottery-betting services, or “synthetic lotteries”, which let punters bet on lottery outcomes without having to buy a ticket in any draw.

Lottery-betting websites, including the Lottoland, have faced criticism in Australia and around the world for cutting into the businesses of lottery-selling newsagencies, and eroding vital tax revenue paid by actual lotteries that helps fund public infrastructure, including schools, roads and hospitals.

Chris Samartzis, of the Victorian Newsagents’ Association, said he believed his group’s deal with MyLotto24 “removes the need for a heavy-handed ban on the entire lottery-betting market”.

No agreement has yet been reached, and the offer is being investigated by some state gambling watchdogs over concerns it may violate retail betting laws.

MyLotto24’s Australian manager, Mikael Sundelin, said the partnership with the Victorian Newsagents’ Association to provide in-store payment on the “Nparcel” system was the “first of its kind” for lottery-betting in Australia.

“This pioneering partnership, a convergence of online and in-store, enables newsagents to benefit from lotto betting in a way that’s been previously closed to them,” he said.