According to the article in leading news outlet O Globo, there would also be a considerable number of low-income people, who are also beneficiaries of the Bolsa Família (social assistance) program, betting.
“There is a perception that we may have a worsening in the quality of credit with a major impairment […] We have been trying to help the government and Congress with the data we have and the growth is very large. The correlation between people who receive Bolsa Família, low-income people, and the increase in bets has been quite large,” he stated.
“We can map what Pix has done for these platforms and the growth since January has been quite large. We take the average ticket and it has gone up by more than 200%. It is something that draws attention and we are beginning to have the perception that it will have an effect on default at the end,” commented the director when saying that the credit data came in stronger than the monetary authority’s expectations.
At a conference organized by Banco Safra in São Paulo this morning, Campos Neto also mentioned that inflation remains a concern in the country, especially with economic growth above-expected economic growth and a buoyant job market.
The Bank is still studying the impact of historically low unemployment on inflation, but there are signs that this factor is starting to weigh.
“The Central Bank is very uncomfortable with what is happening with inflation expectations. Long-term inflation is still well above our target.”
He commented that labor market data has fueled debates about the equilibrium unemployment rate, an index that the market has sometimes made mistakes in measuring. Furthermore, according to Campos Neto, Brazil’s growth is slightly above potential, at the margin.
The president said that a slowdown in spending is expected, to some extent due to the influence of the fiscal framework.
There has recently been an increase in risk premiums, but Campos Neto argues that this is related to concerns about transparency in the data, and not to growth in spending.
“We need to use data as input for our models to understand this process of inflation convergence. The framework itself forces a reduction, as much as we do not risk putting in, but we understand that there will be a slowdown in spending,” he said.
“More recently, this risk premium has emerged, but not from the trajectory and number of expenses, but from transparency in relation to the (fiscal) numbers,” he concluded.
BC technical analysis on the betting market
Tuesday (24) this week, the Central Bank (BC) released a Technical Analysis on the online betting market in Brazil and the profile of bettors. The special study was conducted at the request of Senator Omar Aziz (PSD-AM). "The objective is to measure the size of the online gambling and betting market in Brazil," says the BC.
The study highlights that the analysis presents challenges, since "many companies that operate online gambling and betting do so under names that do not correspond to those disclosed in the media and several of them are not correctly classified in the appropriate economic sector (CNAE 9200-3/99, related to the exploration of gambling and betting)." Many of these companies also do not operate exclusively in the betting sector, making the analysis more complex.
"It should be emphasized that the results are estimates, subject to the risks of the assumptions adopted, and are preliminary results, since the in-depth analysis is still under development."
In a comparison between online betting and lotteries, the BC presented the monthly amounts collected by the modalities in August 2024. In the month, the monthly average collected by lotteries was R$1.9 billion (US$ 345m). This amount corresponds to the sum of the amounts collected in each draw of Caixa Econômica Federal. According to the BC survey, the number of CNPJs of active lottery houses in August 2024 was 13,559.
In the same month, the BC identified a total of 520 active CNPJs that were classified in the CNAE corresponding to gambling and betting, which registered a monthly average in August of R$300 million (US$ 54.5m).
Finally, the study presents data from betting and gambling companies that do not identify themselves in the appropriate CNAE. These companies, explains the BC, were identified based on citations on the internet and the application of filters with typical characteristics of betting transfers. Thus, 56 companies were identified that received a total of R$20.8 billion (US$ 3.8bn) in transfers in August.
The study shows the evolution of transfers to gambling and betting companies throughout 2024, with monthly amounts ranging from R$18 billion (US$ 3.3bn) to R$21 billion (US$ 3.8bn). "Based on the transfers made from these companies to individuals, we estimate that approximately 15% of the bets are retained by the companies, with the remainder distributed to the winners as prizes," highlights the BC.
Profile of gamblers
The analysis estimates that around 24 million individuals participated in gambling and betting, making at least one transfer via Pix to companies during the period analyzed. Regarding the profile of gamblers, the majority are between 20 and 30 years old, although bets are made by individuals of different age groups.
It was also identified that the average monthly value of transfers increases according to age. For younger people, the average is around R$100 per month. For older bettors, the amount exceeds R$3,000 (US$ 545) per month, according to data from August 2024.
It is estimated that, in the same month, 5 million people belonging to families receiving Bolsa Família (PBF) benefits sent R$3 billion (US$ 545m) to betting companies via Pix, with an average spending per person of R$100 (US$ 18.2). Within this universe of bettors, 4 million are heads of families, those who actually receive the benefit, and sent R$2 billion (US$ 363m) - 67% - via Pix to betting companies.
According to the study, around 17% of those registered in the program bet during the period. "These results are in line with other surveys that point to low-income families as the most affected by sports betting activity. It is reasonable to assume that the commercial appeal of getting rich through betting is more attractive to those in a situation of financial vulnerability."
The BC says it is paying close attention to the issue and that it needs more data and time to more robustly assess the implications for the economy, financial stability and the financial well-being of the population.
Source: O Globo
