The government’s move to outlaw online money gaming has thrown India’s gaming ecosystem into chaos, with companies scrambling for survival strategies, gamers rushing to withdraw funds, and experts warning it could fuel black-market activity rather than curb it.
Gaming firms such as Dream11, MPL, Games24X7, Gameskraft, Head Digital Works, Winzo and Zupee are weighing options while online forums are abuzz with discussions on how to bypass the restrictions through virtual private networks (VPNs) or informal cash play, company executives and industry leaders said on condition of anonymity.
“This will promote the illegal peer-to-peer networks which collect cash offline and funnel crores of rupees overseas,” said an executive at one of the affected companies.
Some companies are considering legal action against the government, while others plan to request a 3-5 month transition window to pivot their business models towards subscription or advertising-based.
The Lok Sabha on Wednesday passed the Promotion and Regulation of Online Gaming Bill, 2025, which proposes sweeping bans and steep penalties on real-money online gaming.
“For the past five years, the gaming sector has been forced to fight the government’s inconsistent actions, whether on taxation or even the basic definition of gaming,” a founder at a leading company said.
"Once again, we are consulting legal teams to explore how the constitutionality of this bill can be challenged. But the sentiment across the industry is clear: the next six months could be the most difficult period in the two-decade history of India’s gaming companies,” the person said.
Also Read: Industry mulling legal challenge among options as LS passes online gaming bill
The immediate crisis is handling mass withdrawals from player wallets by panicked gamers.
Several firms are examining reserves to prevent a potential “bank run” situation since not all have sufficient cash on hand.
Founders are also preparing to send assurances to both employees and users to calm nerves in what is shaping up to be the sector’s biggest existential challenge.
Influencers hit
Gaming influencers, many of whom built careers creating “dream teams” in fantasy sports, face some of the steepest losses. With substantial followings, brand deals, and earnings in lakhs, these creators now see their livelihoods under threat.
“This could lead to a rise in surrogate advertising on social media, where proxy influencers or micro-creators promote betting platforms through reels and shorts,” said Rohit Agarwal, founder and director of marketing agency Alpha Zegus. “While mainstream celebrities have stayed away due to strict guidelines, the grey market of proxy ads could expand unchecked.”
An industry insider said, “Some influencers are still in denial, urging the community to stay calm and insisting the government will spare organised platforms.”
Civil society groups have also questioned the efficacy of the ban.
Abhay Raj Mishra, president and national convenor of Public Response Against Helplessness and Action for Addressal (Prahar), warned the move would backfire.
“The government needs to reconsider and take a more calibrated stance, as prohibition has never worked,” he said. “This bill will bring back the satta market with vengeance. Blanket bans tend to drive users to unregulated platforms rather than protecting them.”
Mishra pointed to Prahar’s survey of 2,500 gamers in Telangana, which showed that despite an eight-year ban, players continued to access money games through VPNs, side-loaded apps, Telegram groups and payment workarounds. “More than 94% said they want regulated, legal options,” he added.
Also Read: Proposed online gaming bill could wipe out India’s real money gaming sector, push users offshore, warn industry leaders
Gaming firms such as Dream11, MPL, Games24X7, Gameskraft, Head Digital Works, Winzo and Zupee are weighing options while online forums are abuzz with discussions on how to bypass the restrictions through virtual private networks (VPNs) or informal cash play, company executives and industry leaders said on condition of anonymity.
“This will promote the illegal peer-to-peer networks which collect cash offline and funnel crores of rupees overseas,” said an executive at one of the affected companies.
Some companies are considering legal action against the government, while others plan to request a 3-5 month transition window to pivot their business models towards subscription or advertising-based.
The Lok Sabha on Wednesday passed the Promotion and Regulation of Online Gaming Bill, 2025, which proposes sweeping bans and steep penalties on real-money online gaming.
“For the past five years, the gaming sector has been forced to fight the government’s inconsistent actions, whether on taxation or even the basic definition of gaming,” a founder at a leading company said.
"Once again, we are consulting legal teams to explore how the constitutionality of this bill can be challenged. But the sentiment across the industry is clear: the next six months could be the most difficult period in the two-decade history of India’s gaming companies,” the person said.
Also Read: Industry mulling legal challenge among options as LS passes online gaming bill
The immediate crisis is handling mass withdrawals from player wallets by panicked gamers.
Several firms are examining reserves to prevent a potential “bank run” situation since not all have sufficient cash on hand.
Founders are also preparing to send assurances to both employees and users to calm nerves in what is shaping up to be the sector’s biggest existential challenge.
Influencers hit
Gaming influencers, many of whom built careers creating “dream teams” in fantasy sports, face some of the steepest losses. With substantial followings, brand deals, and earnings in lakhs, these creators now see their livelihoods under threat.
“This could lead to a rise in surrogate advertising on social media, where proxy influencers or micro-creators promote betting platforms through reels and shorts,” said Rohit Agarwal, founder and director of marketing agency Alpha Zegus. “While mainstream celebrities have stayed away due to strict guidelines, the grey market of proxy ads could expand unchecked.”
An industry insider said, “Some influencers are still in denial, urging the community to stay calm and insisting the government will spare organised platforms.”
Civil society groups have also questioned the efficacy of the ban.
Abhay Raj Mishra, president and national convenor of Public Response Against Helplessness and Action for Addressal (Prahar), warned the move would backfire.
“The government needs to reconsider and take a more calibrated stance, as prohibition has never worked,” he said. “This bill will bring back the satta market with vengeance. Blanket bans tend to drive users to unregulated platforms rather than protecting them.”
Mishra pointed to Prahar’s survey of 2,500 gamers in Telangana, which showed that despite an eight-year ban, players continued to access money games through VPNs, side-loaded apps, Telegram groups and payment workarounds. “More than 94% said they want regulated, legal options,” he added.
Also Read: Proposed online gaming bill could wipe out India’s real money gaming sector, push users offshore, warn industry leaders
