News

Febraban calls for expedited credit card betting ban in Brazil

Wednesday 18 September 2024 16:19 CET | News

The Brazilian Federation of Banks (Febraban) has urged the government to expedite its ban on using credit cards for betting, which is currently set to take effect on January 1, 2025.

This move comes as concerns grow over the increasing use of credit cards for betting activities and their potential financial risks.

Febraban urges faster implementation of credit card betting ban in Brazil

Brazil is preparing to launch a regulated betting and gaming market in 2024 under new legislation. The regulations, announced by the Ministry of Finance in April, will prohibit credit card use for fixed-rate betting, including sports betting and online games. Additionally, payments via cash, bank slips, checks, cryptocurrencies, and other methods that may obscure the source of funds will also be banned.

The Central Bank reported a credit card delinquency rate of 7.39% in July, slightly lower than the annual average of 7.71%. A Datafolha survey revealed that 15% of Brazilians engage in online sports betting, with an average monthly expenditure of USD 48.2, which is about 20% of the 2023 minimum wage. Among these bettors, 30% spend over USD 18.2 per month, and one-third are in debt and hold multiple credit cards.

Countries like the UK and Australia have already implemented similar bans to mitigate gambling-related financial risks. The UK introduced its ban in 2020, and Australia has imposed restrictions to prevent financial harm and promote responsible gambling.

Brazil’s new gambling regulation

The Brazilian government has embarked on a significant overhaul of its gambling regulations to address the growing concerns over unregulated betting practices. The new legislation, spearheaded by President Luiz Inácio Lula da Silva, aims to establish a comprehensive regulatory framework for gambling in Brazil. This initiative is part of a broader strategy to create a controlled and transparent market that curbs illegal activities and ensures consumer protection. By setting up a regulated betting environment, the government seeks to prevent financial exploitation and mitigate the risks associated with gambling, including debt accumulation and fraudulent practices.

The legislative framework encompasses a range of measures designed to bring betting operations under strict oversight. Key provisions include the ban on using credit cards for fixed-rate betting, which covers sports and online gaming. Additionally, the regulations will prohibit various payment methods that could obscure the source of funds, such as cash and cryptocurrencies. These steps are intended to add to the integrity of the betting market, protect consumers, and ensure that betting activities are conducted in a secure and regulated manner. The establishment of this market represents a significant shift from Brazil's previously fragmented and largely unregulated betting landscape.


Source: Link


Free Headlines in your E-mail

Every day we send out a free e-mail with the most important headlines of the last 24 hours.

Subscribe now

Keywords: credit card, regulation, payments , banks, cryptocurrency
Categories: Payments & Commerce
Companies: Febraban
Countries: Brazil
This article is part of category

Payments & Commerce

Febraban

|
Discover all the Company news on Febraban and other articles related to Febraban in The Paypers News, Reports, and insights on the payments and fintech industry:





Industry Events