Brazil blocks welfare recipients from online gambling

Brazil’s Federal Government is cracking down on millions of social benefit recipients who’ve been using welfare money for online gambling. The restrictions will hit over 50 million Family Allowance (Bolsa Família) recipients, plus another 3.75 million people receiving Continuous Cash Benefit (BPC).

Regis Dudena, Secretary of Prizes and Gambling at the Ministry of Finance, is spearheading the enforcement effort. Around 80 licensed sports betting operators across Brazil must now comply with these new verification requirements.

Why Brazil Made This Move

The Supreme Federal Court ordered the government to stop social assistance funds from flowing into online gambling after discovering welfare money was being diverted from basic needs to betting accounts. The scope of the problem surprised officials when they dug into the numbers.

About 17.7 million Brazilians placed bets during the first half of 2025, averaging around BR164 monthly per active bettor. The Ministry estimates effective monthly gambling spending hits BR2.9bn ($580m) – though that’s well below the Central Bank’s figures of BR20-30bn monthly.

Even at the lower estimate, officials realised too much welfare money was ending up in betting accounts instead of paying for food and housing.

What Changes Immediately

The new system creates two main barriers for benefit recipients. They can’t open new betting accounts, and anyone with existing accounts gets blocked from making fresh deposits.

Since Brazilian law requires users to register their CPF (individual tax ID) and link a bank account before placing bets, operators can now cross-reference this data against welfare recipient databases. The Federal Data Processing Service (Serpro) provides real-time verification through a centralised system.

“It is a centralised registration, with the data of the beneficiaries of these two major social programs, which will be consulted by the betting houses via API,” Dudena explained. Operators won’t get complete beneficiary lists but must query the database for each registration and deposit attempt.

How the System Works

The verification system launches this September with a one-month adaptation period before becoming fully operational by year-end. Operators will need to integrate with Serpro’s API to check every new user registration and deposit request against the welfare database.

But this is just the beginning of deeper government scrutiny. Dudena says officials want to understand spending patterns better, noting that while average monthly spending sits at BR160, the distribution varies wildly between light users and heavy spenders.

“We know the average spending is BR160 per month. But how is it distributed? I have many players with very low spending and a few with very high spending,” he said. “We are beginning to examine this in more detail now.”

The August Family Allowance program covered 19.2 million families, while July BPC benefits reached 3.75 million recipients.