The second-order effects of a ban on real-money gaming (RMG) are set to be felt across the fintech sector, with digital payment companies and regulatory technology startups bracing for a large chunk of their business disappearing.
The Promotion and Regulation of Online Gaming Bill, 2025, which seeks to impose a countrywide ban on online games where real money is wagered, has received Parliament approval with the Rajya Sabha passing it on Thursday, a day after the Lok Sabha cleared it. This is set to impact gaming platforms like Dream11, Pokerbaazi and MyRummyCircle.
Also Read: Real money gaming firms begin discontinuing offering; look for alternative revenue streams
According to multiple industry insiders, the payments industry could potentially lose Rs 20,000-30,000 crore in monthly transaction volumes once movement of money for real-money gaming stops.
“You will see some impact playing out on UPI payments as well since that was the most popular payment mode used by gamers,” the founder of a payment firm said on the condition of anonymity.
Typically, transactions on RMG platforms skyrocket during popular cricket tournaments like the Indian Premier League and ICC World Cup.
Also Read: Ban on real money gaming may york cricket revenues
The founder said those bumps would disappear and it would be a huge loss to the payments industry, which chases payment volumes as a major growth indicator.
Payment firms used to chase gaming platforms given they offered better margins and volumes tend to be very high, another senior industry insider told ET. There would be a dent in terms of revenue as well, he said.
Cashfree, Razorpay, PayU and Easebuzz are some of the payment firms that powered gaming firms.
Responding to ET’s queries, a Razorpay spokesperson said the firm’s exposure to the sector was less than Rs 1,000 crore in transactions monthly.
The company did not comment on the revenue impact.
A PayU spokesperson said the company’s engagement with gaming merchants had been limited. “We partner only with a very small number of skill-based gaming players. Gaming represents only a minor portion of our overall portfolio. Given this measured and controlled exposure, the impact on our overall business is non-existent,” the spokesperson said.
Queries emailed to Cashfree and Easebuzz remained unanswered at press time Thursday.
Besides payment firms, regulatory tech startups, those who offer customer-verification services to gaming platforms, are set to see an impact. Gaming companies take their service to undertake a video KYC, which most of the large platforms had made mandatory before a user could withdraw the funds won in the games. In fact, Tamil Nadu had mandated KYC of users even before they could wager any money for a game.
“The regulatory technology platforms that were earlier instrumental in supporting RMG platforms with compliance solutions will now have to look for other avenues to assist emerging forms of sports platforms in staying on the right side of the law,” said Rishi Agrawal, chief executive officer at Teamlease Regtech.
Without real money being involved, these platforms will no longer go for large customer-verification processes, instead focusing on simple customer onboarding.
“Many of the ID verification firms are dependent on RMG players for revenue generation, now that will completely disappear from the top line,” said the founder of an identity verification startup.
While the legislation has been designed to protect Indians and especially the youth from addiction, financial ruin and mental health issues, the blanket ban would disrupt a large industry that employs around 200,000 people and received Rs 25,000 crore in foreign direct investments in more than 450 startups, according to industry executives.
