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Brazilian football clubs have warned of “fatal blow” to national sport as concerns about the impact of online gambling grow worldwide.
Less than two weeks before the first round of Brazil’s genuinely make-or-break presidential elections, on October 4, incumbent President Luiz Inácio Lula da Silva has set his sights on one of the country’s fastest growing business sectors: online gambling. As concerns grow about the sector’s effects on the indebtedness of families, especially those with lower incomes, Lula is even talking about imposing a total ban on online casinos.
“Are we remaining passive while society drowns in debt?” Lula said. “Are we remaining passive while society is driven to madness – because this is an illness. People lose their minds; they contemplate suicide or abandoning their homes. So, we are going to take serious action.”
Like the US, Brazil has developed a serious gambling problem since legalising fixed-odds sports betting in 2018. Like the US, Brazil has emerged from nowhere to become one of the world’s biggest betting markets (#1 in the case of the US, #5 in the case of Brazil). As in the US, the spectacular growth of this nascent sector has come at a very heavy price, reports the Irish Independent:
In 2024, online gambling losses drove an estimated 1.8 million Brazilians into debt. It is affecting the country’s most vulnerable households: In one month last year, hundreds of millions of dollars from the Bolsa Familia, Brazil’s largest welfare programme, were spent on betting platforms. Demand for treatment related to gambling addiction in the public health system has risen 140pc in five years.
Brazil’s online gambling sector has registered growth of close to 500% since January 2023, while the number of people placing bets has also risen steadily. In 2025, Brazil recorded a monthly average of approximately 9.25 million bettors, with peaks exceeding 10.8 million during periods of peak football activity, such as October.
Lula has been trying to buck this trend for some time, including by signing a decree allowing the government to freeze the funds of companies that run illegal online gambling platforms. In July, his government imposed strict advertising rules on online gambling companies, including mandatory warning labels on all betting ads about addiction risks and potential financial losses.
Lula’s concerns are well justified. In 2025, $68 billion was wagered via Pix, the country’s digital payments system, just one year after online gambling was fully legalised, reports Agência Publica. Of that money approximately $12 billion was lost, which is apparently equivalent to 0.68% of the gross national disposable income of Brazilian families.
Many of those families are in Brazil’s poor and working classes — one of Lula’s core constituencies. In a speech on Sunday the president said that if it were up to him, online betting companies would be shut down completely, though he acknowledged that any change will depend on the will of Congress, which is far from guaranteed. Brazil’s Finance Minister Dario Durigan, meanwhile, insists the government has not yet made a decision on the matter.
Lula is now planning two additional measures: a complete ban on online casino activity, and the creation of an electoral programme in which he meets with Brazilians affected by problem gambling.
If Lula wins the upcoming election, Brazil may become the first Top-10 economy in the world to try to reverse some of the damage caused by legalised online gambling. The fact that his rival, Flavio Bolsonaro, is not opposing Lula on this issue suggests the proposed ban enjoys broad public support.
For those wondering, Lula appears to have an even chance of winning that election after major tracking polls have tightened. A scandal involving Alexandre de Moraes, the powerful judge who led the coup trial that convicted former president Jair Bolsonaro, has exacted a heavy toll on Lula’s campaign. As regular NC readers are aware, Trump-endorsed, pro-Israel candidates have a near-perfect record of winning general elections in Latin America over the past year.
Lula’s proposed ban on online gambling will apparently not extend to sports betting and sponsorship agreements involving sports clubs and competitions. But it could still have a major impact on both areas.
Sports betting and online casino “products” are generally operated by the same companies. More important still, online casino games are estimated to account for around 75% of operators’ revenues. As such, any sizeable hit to that side of the business would mean a lot less money available for sponsorship and advertising. From the Reuters article:
Brazil’s government is reportedly preparing an executive order to ban online casino operations in the country despite concerns over lost tax revenue and potential legal challenges from companies licensed to operate in the country, sources familiar with discussions within the presidential office told Reuters.
Leftist President Luiz Inacio Lula da Silva, who has repeatedly signaled he wants to curb online gambling, is expected to sign off on the final text before the first round of general elections on October 4, according to three sources, who spoke on condition of anonymity…
Officials acknowledge that banning online casinos while preserving sports betting would significantly reduce operators’ revenues, affecting sports sponsorship spending and government tax receipts.
Brazil’s biggest football clubs have already responded to the threat by issuing a joint statement warning that “making the current model unviable” could favour the growth of illegal platforms that do not pay taxes or comply with current regulations. It could also deliver a “fatal blow to Brazilian football”, they said, perhaps even tipping some clubs into insolvency.
Betting sponsorship has become the main source of income for Brazilian football, reaching $200 million in 2026. That money trickles down to smaller clubs, lower divisions and lower-profile competitions, according to One Football. The funds are necessary to support the “administration, training centres, social projects, women’s football and youth development, areas that are often the first to suffer cuts when revenues fall”.
In other words, Brazilian football clubs are now financially hooked on the sponsorship fees coming from online betting firms, much like national and regional governments are growing increasingly dependent on the tax revenues paid by online betting companies…
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