Bets on betting platforms could reach R$ 30 billion per month in Brazil by 2025

According to the Banco Central (Central Bank) of Brazil, bets on betting platforms could reach up to R$ 30 billion per month in the country by 2025. This data was presented last week in the Brazilian Senate by Gabriel Galípolo, president of the Banco Central, during a session of the “CPI das Bets”, a parliamentary inquiry commission that aims to clarify the impact of digital betting on the financial health of Brazilians.

On the same day, Rogério Lucca, executive secretary of the Central Bank, said that currently between R$ 20 billion and R$ 30 billion are already being wagered monthly in betting platforms in Brazil. 

The Central Bank presented the data of a study in 2024 that estimated Brazilians spent R$ 20 billion per month, but at the time the research was done the betting platforms were still not regulated in the country. With new regulations in place, it will be possible to assess this number more accurately in future studies. 

“Now with more concrete data, we confirm the figure of R$ 20 billion, and more recently, it may reach R$ 30 billion per month. So far this year, from January to March, the amount we’ve been tracking is around R$ 20 billion to R$ 30 billion per month”, said Rogério Lucca.

The good news for the bettors is that, as Lucca emphasized, a significant portion of that amount, estimated at over 90%, is returned to them as payouts for their wagers.

Bettors have higher credit risk

A study by Banco Central also showed that individuals who engage in online betting have significantly higher credit risk than those who don’t, said Gabriel Galípolo. “Banks consider this type of behavior when analyzing and classifying someone as a higher-risk individual. Ultimately, it leads to higher costs for them,” he said.

Galípolo cited a study indicating that a significant number of bettors viewed betting as an investment alternative. As a result, Banco Central has been promoting financial education initiatives for the population.

Central Bank of Brazil and regulation of betting platforms

BC is not responsible for penalizing financial institutions involved in illegal betting

During the CPI session, senators questioned Banco Central’s role in supervising and penalizing financial institutions involved in illegal betting operations. As Galípolo pointed out, the institution does not have the power to regulate betting platforms. “Banco Central does not have the legal authority to regulate or impose sanctions on fixed-odds betting transactions carried out by unauthorized legal entities,” Galípolo stated.

The authority to sanction these institutions lies with the Secretariat of Prizes and Betting under the Ministry of Finance. “A financial institution, although authorized by us, can be sanctioned in various ways, by the IRS, fire department, etc. Who sanctions depends on the activity that’s triggering the sanction, and in the case of betting, that’s not us”, said Galípolo.

Changes in Brazil’s regulation

In December 2023, Brazil approved Law 14.790/23. Among the main changes imposed by it, private companies will now be able to operate sports betting both online and in physical establishments.

See, below, how this Law will affect sports betting in the country:

• Private companies will be able to operate both online and in physical establishments: until December 2023, sports betting in Brazil was only allowed in lottery shops and was controlled by the federal government. As of January of this year, however, any private company will be able to operate sports betting, whether digitally or in a physical space.
• The minimum age for placing sports bets has increased from 18 to 21 years old.
• Advertisements or any type of publicity targeted at minors have been prohibited.
• Betters must have their identity verified and validated;
• Bookmakers must implement policies to prevent money laundering schemes and promote responsible gambling.

How will sports betting regulation work in Brazil?

It is important to note that, in 2023, Provisional Measure (MP) No. 1.182/2023 was also approved, amending Law 13.756/18. Among other changes, this law allows for more control of the sports betting sector. For example:

• Monitoring: betting houses will have to purchase a license to operate in Brazil. The tendency is for a new department to be created in the Ministry of Finance to accredit companies, after a process of document analysis. If approved, the government will monitor the volume of bets and the institutions’ revenue, which will ensure more control over this market.
• Legality: companies approved in the process mentioned above and with valid licenses will be able to receive bets related to sporting events. These events, however, must be official and organized by federations, leagues or confederations. Betting houses that commit infractions may be fined between 0.1% and 20% of the proceeds of the revenue, depending on the severity of the violation.
• Taxes: players with winnings exceeding R$2,112 will have to pay 30% of the value of their total winnings in taxes, which is the same rate applied to lottery prizes. Betting houses, in turn, must be required to pay an 18% tax on Gross Gaming Revenue (GGR), which is the revenue obtained from all games played, minus prizes paid to players and taxes levied on legal entities. Companies in the sector, like any other, will also need to pay PIS, Cofins, Income Tax, CSLL and ISS.
• Money laundering: betting houses must implement strict control and effective monitoring systems to prevent money laundering. They must submit information about bettors to the Financial Activities Control Council (Coaf).

Bookmakers also need to promote awareness-raising actions regarding pathological gambling disorder, to prevent addiction and ensure the mental health of bettors.

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