Online money games banned: the Promotion and Regulation of Online Gaming Act, 2025

Before 2025, online games involving money in India were regulated by a patchwork of state laws and court rulings. Courts had, in several cases, distinguished games of skill, such as rummy and fantasy sports as then operated, from games of chance, and that distinction shaped what states could prohibit. The result was uncertainty for players, companies, payment providers, and state governments, and a fast-growing market for real-money games advertised heavily during sporting seasons.

Parliament changed that framework in August 2025. The Lok Sabha passed the Promotion and Regulation of Online Gaming Bill on 20 August 2025, the Rajya Sabha followed, and the President assented on 22 August 2025, enacting the Promotion and Regulation of Online Gaming Act, 2025. The Act prohibits offering, operating, facilitating, advertising, and promoting online money games, defined as games played by paying fees or staking money or other stakes in expectation of winning, whether the game is based on skill, chance, or both.

The Act deliberately removes the skill-versus-chance distinction for money games. Offering an online money game can attract imprisonment of up to three years, a fine of up to one crore rupees, or both, while advertising such games can attract up to two years' imprisonment and a fine of up to fifty lakh rupees. Banks and payment providers that process transactions for banned services also face penalties. At the same time, the Act seeks to promote e-sports and online social games, which do not involve staking money or an expectation of winning money, and provides for an authority to regulate the sector.

The Act was not brought into force immediately. After months in which its commencement was awaited, the government announced in April 2026 that the Act and its Rules would come into force on 1 May 2026. Challenges to the Act were transferred to the Supreme Court, where petitioners argued that a blanket ban violates Articles 14, 19(1)(g), and 21 of the Constitution, while the government defended the ban on grounds including addiction, financial harm, fraud, and money laundering.

For civil studies readers, the Act is a case study in how Parliament can override a judicial distinction by statute, and in how a ban is only the first step. Enforcement, the treatment of offshore operators, and the line between a social game and a money game will determine how far the law changes behaviour in practice.