India’s real-money gaming (RMG) industry is experiencing one of its toughest periods to date. The sector has already written off more than Rs70 billion ($840 million) and lost over 7,000 jobs. This downturn stems largely from a continued regulatory limbo caused by the Promotion and Regulation of Online Gaming Act (PROGA), which still awaits notification nearly three months after its passage. As a result, companies remain uncertain about how to move forward.
Financial Fallout Intensifies Across the Industry
According to a Storyboard18 report, industry revenue losses have exceeded Rs100 billion ($1.2 billion). Meanwhile, the government faces an estimated Rs56 billion ($670 million) shortfall in Goods and Services Tax (GST), tax deducted at source (TDS), and income tax revenue. Surprisingly, much of this financial damage occurred even before the law officially took effect.
Industry leaders argue that uncertainty alone—rather than actual enforcement—has caused investors and platforms to pull back.
Moreover, the introduction of a 40% GST for online money gaming on September 22 added even more pressure. Industry estimates link the revenue collapse to this sharp tax increase, which contributed to:
- Rs36 billion in GST revenue gap
- Rs20 billion drop in TDS and income tax contributions
Consequently, the sector is struggling to operate while dealing with mounting regulatory ambiguity.
Legal Experts Question Government Delays
Technology and gaming lawyer Jay Sayta strongly criticized the government’s delay in notifying PROGA. The act moved rapidly from cabinet approval to presidential sign-off in just four days. However, almost 90 days later, the notification that activates the law has still not been issued.
Because of this delay, penalties under PROGA cannot be applied, and banks can still support gaming platforms. Sayta warned that once notification arrives, all current real-money gaming operations must halt immediately, signaling another wave of major disruption.
Companies Record Massive Write-Downs and Workforce Cuts
The financial strain is evident in recent corporate results. Flutter Entertainment announced a $556 million impairment after its India unit Junglee Games suspended cash-based rummy. This contributed significantly to the company’s $789 million net loss in the September quarter—more than six times the loss recorded a year earlier. CEO Peter Jackson called the sudden regulatory shift a major shock.
Meanwhile:
- Nazara Technologies wrote down Rs9.15 billion ($110M) on Moonshine Technologies (PokerBaazi)
- Clairvest reported Rs7.6 billion ($92M) in unrealized losses on Head Digital Works
- Delta Corp wrote off Rs3.8 billion ($46M) across multiple gaming investments
As revenues dried up, layoffs surged across the ecosystem.
Payment Partners Feel the Pressure Too
The crisis also rippled into the fintech sector. Paytm’s net profit dropped by 98% following a Rs1.9 billion ($23M) impairment tied to First Games Technology. Mobikwik reported an eight-fold surge in losses and a 7% decline in operating revenue.
Furthermore, gaming-related UPI payments fell sharply from 351 million in July to 270 million in August, reflecting a steep decline in user activity.
Market Shutdowns Reveal Industry Fragility
Immediately after PROGA passed, major RMG platforms—including Dream11, MPL, Zupee, WinZO, and Gameskraft—paused all real-money formats. Messaging platform Hike shut down its RMG app Rush entirely.
Altogether, rising taxes, sudden write-downs, and a lack of regulatory clarity have pushed the industry to a near standstill. Therefore, the future of India’s RMG market remains deeply uncertain while stakeholders await a confirmed enforcement timeline for PROGA.
Industry Seeks Clear Rules to Recover
For now, operators and investors continue urging the government to clarify the regulatory path forward. The sector believes that definitive rules could restore confidence, protect jobs, and unlock growth in what remains one of India’s fastest-expanding digital entertainment markets—if given the chance.
