Brazilian banking chief calls for Pix payment restrictions on gambling
Isaac Sidney says that the instant payment method allows those on the poverty line receiving state stipends to spend beyond their means
The president of the Brazilian Federation of Banks (Febraban) has suggested a suspension or limit to Pix payments in the betting industry to better protect consumers.
Speaking to journalists yesterday, 2 October, Isaac Sidney said the instant payment method could be tempered with either temporary or emergency blocks.
Pix was introduced by the Central Bank of Brazil in November 2020 and allows the Brazilian population to use their smartphone to scan QR codes to send money and pay for goods and services.
The service has become ubiquitous in the South American country, with operators such as PixBet and BetPix365 having emerged to take advantage of the payment solution.
According to the European Payments Council, around 153 million Brazilians, circa 75% of the population, use Pix.
However, Sidney’s suggestion to implement restrictions on Pix transactions for betting comes after data from the Central Bank of Brazil revealed those on welfare in the country were spending billions on gambling.
It was estimated that in August, five million people belonging to families that benefit from the Bolsa Família welfare programme had spent a collective BRL3bn (£420.6m) on gambling via Pix, with an average spend of BRL100 per person.
Bolsa Família was introduced in 2003 to help reduce poverty across Brazilian, with qualifying families receiving monthly stipends from the state based on factors such as children attending school and up-to-date vaccinated status.
Sidney said: “This brake on the arrangement involves some emergency and temporary measures.
“We have advocated that instant payment methods, such as Pix, can be temporarily suspended for the payment of bets.
“One way to do this instead of banning the use of instant payments is to impose limits per transaction. But the focus is not on a specific payment method. The focus is on finding ways to avoid a deterioration in the level of household debt,” he added.
Sidney’s comments came after he had held a meeting with the Brazilian finance minister Fernando Haddad, although he told the gathered press the conversation was not a high-level decision making one.
Instead, the pair reported explored potential options to help reduce economic harm in lower income communities, with one suggestion being a taskforce implemented to delve into the issue.
Sidney added: “This taskforce could, in addition to the Ministry of Finance, include other government agencies that deal with consumer protection, money laundering prevention and social benefits, such as Bolsa Família.
“There is already a high level of compromise in the free income of low-income families. The State, the public authorities and the private sector need to discuss this issue.”
Earlier this week, the Brazilian government confirmed the 89 operators that will be allowed to remain live in the transitionary period until the end of the year.
The likes of Entain, Flutter and bet365 will all stay active, while local brands such as Esportes da Sorte and Vai de Bet have not been granted approval and must wait until the market regulates on 1 January 2025.