Banese, Banestes, and BRB expand operations into the online lottery and betting market in Brazil.

Three financial institutions with shares traded on the B3 stock exchange are expanding their operations into the lottery and online betting sector in Brazil. Banese (BGIP4) has been operating its own lottery since May of this year, while Banestes (BEES3) plans to launch its own by December 2025, and BRB (BSLI4) attempted to implement a similar project between 2023 and 2024. This move comes at a time when the betting sector is experiencing strong growth in the country.

The economic potential of the online betting market in Brazil is significant. According to a study by the consulting firm Regulus Partners, reported by BBC News Brazil, companies in the sector are expected to generate around R$ 22 billion in revenue in the country by 2025 alone. According to an analysis by Investidor10 , in the first nine months of this year, the federal government collected R$ 6,8 billion in taxes paid by betting companies.

Banese was the first bank listed on the B3 (Brazilian Stock Exchange) to enter this market. The financial institution from Sergipe launched Lotese (Loterias de Sergipe) in May, offering more than 600 types of games in different formats, including online betting, numerical predictions, and scratch cards.

The operation of the Sergipe-based bank is structured as a joint venture with the companies Culloden Participações and TSA Informática, which operate BetSul Concessionária de Serviços Lotéricas do Sergipe. Banese holds a 49,9% stake in the business, with a 20-year contract to operate the service.

Marco Antônio Queiroz, president of Banese, stated during the launch of Lotese that "The funds raised and allocated to the government of Sergipe will remain in the State and will be invested in the development and improvement of the quality of life of our people." He also highlighted that the initiative allows "the people of Sergipe to have access to safe games, with all the necessary transparency and oversight."

The business model stipulates that 5% of the revenue obtained from the lottery will be allocated to the government of Sergipe. The distribution of net revenue provides for 35% for social inclusion and assistance, 25% for culture, 25% for sports, and 15% for the state's environment.

Authorization for Banese to operate lotteries was granted by the Legislative Assembly of Sergipe and Governor Fábio Mitidieri (PSD) in 2024. In Espírito Santo, Governor Renato Casagrande (PSB) authorized the creation of the Espírito Santo Lottery as a subsidiary of Banestes in 2023.

Banestes is in the final stages of preparing to launch its lottery later this year. Last week, the bank from Espírito Santo began exclusive negotiations with the World Lottery Consortium, after concluding a competitive process to select a partner.

“During the exclusive negotiation period, Banestes and the World Lottery Consortium will discuss the terms and conditions of the definitive contracts for the potential partnership, in addition to concluding the reciprocal due diligence initiated during the proposal evaluation phase,” the bank informed. The institution emphasized that “the formalization of the partnership depends on the satisfactory conclusion of negotiations between the parties, and there is no guarantee that the negotiations will result in the signing of definitive contracts.”

Amarildo Casagrande, CEO of Banestes, explained that the partner selection process was conducted "very meticulously." According to him, the bank was looking for a partner with international experience, certifications, and technology suitable for the business.

The legislation of Espírito Santo stipulates that up to 12% of the funds raised by the Banestes lottery will be allocated to the state for investments in culture, sports, leisure, social assistance, and tourism.

BRB also attempted to create its own lottery between 2023 and 2024, but the project was halted after the Attorney General's Office initiated an investigation into the contract signed with the Santa Casa de Misericórdia de Lisboa.

Caixa Econômica Federal, the traditional operator of lotteries such as Mega Sena, plans to launch its own online betting platform, "bet da Caixa," at the end of November. The bank projects to raise up to R$ 2,5 billion with the initiative in 2026.

President Lula expressed concern about the growth of online gambling in Brazil. "Many people are going into debt, many people are spending what they don't have. And we believe this needs to be treated as a matter of addiction," the president said in October 2024, when the government decided to increase regulation of the sector.