Brazil to Implement Payment Restrictions for Sports Betting and Online Gambling

The Brazilian government, led by President Lula, is set to introduce new restrictions on payments for sports betting and online gambling, with measures expected to take effect this week.

This move is part of a larger effort to regulate the rapidly expanding gambling industry in the country. However, the exact details of the restrictions are still being discussed.

The Ministry of Finance has scheduled meetings with legal sports betting operators in Brazil to address the upcoming payment limitations. According to Dário Durigan, executive secretary of the Ministry of Finance, these discussions will focus on the 190 authorized websites that continue to operate legally within the country. President Lula has already approved the implementation of these restrictions, which may include limiting the use of government-issued payment cards, such as those linked to the Bolsa Família social program.

Durigan emphasized that “the Bolsa Família public is protected by the suspension of illegal ‘Bets’ and now by the fine-tooth comb that will be carried out on authorized companies.” He also clarified that while no specific measures have yet been taken for Bolsa Família beneficiaries, the use of their payment cards for gambling has not been suspended.

The government's plan to block unauthorized betting websites is slated to begin on October 11. Durigan explained that this measure aims to help create clearer rules for online gambling, particularly concerning users who benefit from government aid programs.

Concerns surrounding the gambling industry have escalated following a report from Brazil’s Central Bank, which revealed that Brazilians spend an average of BRL20 billion ($3.7 billion) monthly on gambling, largely facilitated through the Pix payment system. In August alone, an estimated 5 million Bolsa Família recipients were believed to have spent BRL3 billion ($550,000) on online gambling, prompting the government to take swift action.

The Ministry of Finance is also working on a "negative list" of illegal gambling operators, which will be shared with various authorities, including the National Telecommunications Agency (Anatel), to facilitate the takedown of unauthorized websites.

Minister of Justice Ricardo Lewandowski stated that the Federal Police are targeting criminal activities associated with illegal gambling, such as money laundering. He also indicated that minors, particularly influencers, would face restrictions from participating in the betting industry.

A recent government meeting, attended by Vice President Geraldo Alckmin and multiple cabinet ministers, focused heavily on the gambling sector. President Lula voiced his concern about the growing problem of gambling addiction, warning that "there are a lot of people getting into debt, a lot of people spending what they don’t have, and we think that this should be treated as a matter of dependency."

Finance Minister Fernando Haddad highlighted the various measures the government has already implemented to regulate the betting market. These include ordinances on fair play, certification, financial oversight, and a ban on the use of credit cards for online gambling.

While the prohibition on credit card payments for betting was initially scheduled to take effect in January 2025, credit card companies have voluntarily blocked the use of cards for betting earlier this year.

In the coming days, the Brazilian government plans to remove up to 2,000 unauthorized betting websites from cyberspace. This effort is part of a broader regulatory process initiated by the Ministry of Finance, which will formally come into force in January 2025.

Haddad emphasized the importance of collaborating with other government ministries, including Health, Social Development, and Justice, to comprehensively address issues related to gambling, especially those impacting vulnerable populations, such as Bolsa Família recipients. 

By fLEXI tEAM