In a move to check rampant online fraud, the Union Cabinet on Tuesday approved the much-awaited Online Gaming Bill, which seeks to regulate the misuse of online gaming apps and similar platforms. Titled ‘The Promotion and Regulation of Online Gaming Bill, 2025’, the proposal law aims to regulate the sector and curb illegal betting. The Bill is likely to be tabled in Parliament on Wednesday. The move of the Government comes after a rise in fraud cases in recent months, with several investigating agencies stepping up action against celebrities promoting such applications.
The Bill proposes that any person offering online money gaming service in violation of the stipulated provisions will face imprisonment of up to three years or a fine that may extend to Rs 1 crore, or both. The provisions also stipulate imprisonment of up to two years and or a fine of up to Rs 50 lakh, or both, for those indulging in advertisements in contravention of rules. Also, those engaging in any transaction or authorisation of funds will be liable for up to three years imprisonment, or a fine up to Rs 1 crore or both, according to the source.
Repeat offences for violation related to online money gaming attracts higher stringent jail term (3-5 years) as well as fine.
The decision has come following observations from the Governmentthat online money gaming provides means to facilitate money laundering, fraudulent financial transactions, and cyber crime, among others.
Under the proposed bill banks and financial institutions will not be allowed to process or transfer funds for real-money online games.
It also prohibits transfer of funds by permitting, aiding, abetting, inducing or otherwise facilitating any transaction or authorisation of funds by bank, financial institution or any other person towards payment for any online money games and declares it as an offence. The Bill also prohibits the offering, aiding, abetting, inducing or otherwise being involved in the making or causing to be made of advertisements that promotes any person to play any online money game and declares it as an offence.
The Bill also proposes a complete prohibition on advertisements promoting real money gaming, continued promotion of E-sports and non-monetary skill-based games and strict action against unregistered or illegal gaming platforms.
There is an urgent need to regulate Online Gaming-on the one hand, promoting online social games and e-Sports while prohibiting the online money gaming in the larger public interest.
It proposes stricter oversight of gaming platforms, particularly those offering real-money games. It may designate the Ministry of Electronics and Information Technology (MeitY) as the central regulator for online gaming. The bill may also empower authorities to block unregistered or illegal gaming sites.
According to officials, Online money gaming content, often influenced by foreign platforms, promote violence, obscenity, or anti-social behavior. Such content not only undermines Indian cultural values but also creates long-term behavioral conditioning among impressionable users.
As per the present legal framework in place, states and Union Territories are primarily responsible for the prevention, detection, investigation and prosecution of crimes, including action on illegal betting and gambling.
India’s online gaming industry is projected to more than double to $9.1 billion by 2029. Real-money games account for nearly 86 per cent of revenues, with the market size estimated at $3.7 billion in 2024.
Several real money gaming firms masquerading themselves as “game of skills” to differentiate themselves from betting or gambling platforms and avoid ban.
In June, Madras High Court had dismissed a petition filed by real money gaming platforms Play Games 24X7, Head Digital Works, Junglee Games and others challenging the ban imposed by the Tamil Nadu government.
The court rejected arguments of the real money gaming firms challenging jurisdiction of the state to regulate digital platforms as well as their argument to differentiate “games of chance” from the “game of skills”.
The Tamil Nadu government, citing an expert committee report, said that online games involving real money have posed serious mental and physical health risks to the citizens, including suicides by some, in the state.
The court upheld that the state has full competence to pass legislation to govern matters affecting public health and rejected arguments challenging its power to ban game of skills involving real money.
The real money platforms had cited IT Rules 2021 of the Centre, saying that it has adequate safeguard for online games to defend themselves, but the court observed that it has not come into effect till then.
The Centre has also been taking a series of measures to block online betting and gambling platforms. It issued 1,524 orders from 2022 till June 2025 to block online betting and gambling platforms. At present, Directorate General of GST Intelligence Headquarters is empowered under the Information Technology Act, 2000 and the IGST Act to direct intermediaries to block unregistered online money gaming platforms, including offshore gaming platforms, violating the IGST Act.
The suppliers of online money gaming are also being regulated under the Integrated Goods and Services Tax Act, 2017 (IGST Act).