The Indian Government has introduced 'The Promotion and Regulation of Online Gaming Bill, 2025' primarily to prohibit operation, participation and advertisement in online money games. As of today, this bill has been passed in both the houses of parliament, despite protests against it. The Bill classifies online games into three categories: online money games, online social games, and e-sports. It applies to all online games offered or accessible in India, thereby bringing foreign entities within its ambit as well.
While the Central government is making provision for the recognition and development of online social games and e-sports, there are regulations prohibiting online money games. This has drawn mixed responses, with industry federations describing the move as a "death knell" for the online money gaming sector.
There's a Times of India report, citing industry experts, warning that this could hamper around 4 lakh companies, jeopardise 2 lakh jobs, risk investments of Rs 25,000 crore and GST collections of Rs 20,000 crore at 28%. Further, companies like Dream11, MPL, etc, will endure some challenges.
Types of Online Games as per the Law
Online money game
Where the user deposits money into the game in expectation of winning monetarily.
Online social game
Does not involve staking money or expecting monetary wins and is not considered gambling. It may charge a fee for access/ subscription only. Purely entertainment, recreation, or skill development related game.
E-sport
Skill-based online game recognized under the National Sports Governance Act, 2025, involving organized competitive events. Only participation fees and prize money based on performance are allowed.
Penalties
| Nature | Prohibition | Penalties (1st time) | Repeat offender |
| Online money game | Engagement/ indulgence in the game or its service | Imprisonment < 3 years; or Fine < Rs 1 cr; or both | Imprisonment - 3 to 5 years; or Fine - Rs 1cr to Rs 2cr; or both |
| Involved in making any advertisements in any media promoting any person to play | Imprisonment <2 years; or Fine < Rs 50 Lakh; or both | Imprisonment - 2 to 3years; or Fine - Rs 50 Lakh to Rs 1 Cr; or both | |
| If banks grant authorisation of funds to facilitate any transaction for any such service. | Imprisonment < 3 years; or Fine < Rs 1 cr; or both | Imprisonment - 3 to 5 years; or Fine - Rs 1cr to Rs 2cr; or both | |
| Any online game | Fails to comply with the order of CG or any authority created through this bill | Fine < Rs 10 Lakh; or suspension/ cancellation of licenses. | - |
These offences are cognizable and non-bailable, meaning that the accused may be arrested without a warrant, and bail can only be granted by a court of law and not the police.
The legislation also includes search and seizure provisions, empowering authorized officers to investigate, search, and seize both digital and physical property connected to the offences.
Additionally, independent or non-executive directors who are not involved in day-to-day decision-making are granted protection under the Bill.
Key Points to Remember
- Online money games involving stakes, and gambles are prohibited or banned
- Online games for skill development or entertainment with only subscription or fees to be paid are going
- to be regulated by authorities
- Penalties imposed include imprisonment and/ or fine.
- Warrantless search provisions included
- Offences are non-bailable.
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