The Online Gaming Bill 2025, approved by the Union Cabinet on Tuesday, prohibits advertising or endorsements of platforms facilitating online games that involve monetary transactions.
The legislation proposes to bar banks, as well as non-banking financial bodies, from facilitating any transaction involving online money games.
At present, there is no uniform national law on the subject, with individual states enacting varied gambling statutes. Courts too have offered inconsistent interpretations of the distinction between games of skill and games of chance.
The rise of in-app purchases, virtual currencies and reward systems has only blurred these legal boundaries further, creating the need for a centralised framework.
Concerns like addiction among children and youth, mental health issues, financial losses, cross-border and inter-state operations facilitating in some cases money laundering and terror financing form some of the focal points of the Bill, said sources on the matter.
The legislation also stresses on ensuring India's swiftly growing digital gaming market is aligned with national interests, public safety, and ethical business practices, they further stated.
Penalties proposed under the Bill are stringent. Any person offering online money gaming services could face up to three years in prison and a fine of Rs 1 crore. Those involved in advertising or endorsing such platforms may face up to two years in jail along with a Rs 50 lakh fine.
Similarly, anyone facilitating transactions or fund transfers for online gaming could face three years of imprisonment and penalties up to Rs 1 crore.
In order to regulate the sector more effectively, the Bill also proposes the creation or designation of an existing regulator to categorise and register online social games. Should a new authority be established, the financial implications are estimated at around Rs 50 crore in initial capital expenditure and Rs 20 crore in annual running expenses.
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