In the past, the Indian online gaming debate focused on whether an online game was primarily based upon either chance or skill. The online gaming framework was changed by the Promotion and Regulation of Online Gaming Act, 2025. Parliament passed Act No. 32 in August 2025 and the regulations for the new act went into effect on 1 May 2026.

This is important to both developers and organizers because regulators will be able to look at what type of access fees are charged, what types of rewards players receive, and if the player’s virtual assets are convertible into cash. Rather than relying on how a developer labels their product, it is the actual product design that will determine where it falls within this regulatory framework.

How Online Games Are Being Tested by Their Use of Money

Online games can involve either skill, chance, or a combination of both. The critical issue for users is if they pay a fee (or deposit) in exchange for the possibility of earning monetary gains, other forms of enrichment, etc. All formats that previously were able to argue their games are “games of skill” will be subject to the national test.

Not all online games require you to spend money. As long as you are buying access with your initial payment and do not have to put up a bet or expect a return on your investment, a one time or recurring payment could work in conjunction with a social game. Therefore, a fixed cost of entry versus a wager and potential profit is treated as two different things.

Three Categories of Legal Treatment Based on Type

The framework divides digital games into three main types of games. These include:

• Competitive Esports: Organised competitions of digital games which are subject to registration and potentially supported by the government (standards, training, research etc.) through their sporting organisations.
• Social Games Online: Offered for enjoyment, leisure or skill development and do not have money or money equivalent betting stakes. Subscription or access fees can be charged for these types of games.
• Money Games Online: Involve betting, gambling, wagering or money (tokens, credits etc.) and/or anything else where the player expects a monetary return or something of equal value. Money games are illegal regardless of if they require luck, skill or some combination of the two.

Strategy or competition will never make a cash game an esport.

How New Legislation Will Affect Online Poker

Online poker illustrates how the new law will alter the legal test. Readers researching offshore poker options may still come across guides to the Pinco site, but such references do not indicate that a platform is lawful, registered, or available in India. While strategy, probability and decision making continue to be aspects of the game, these elements do not define the legality of the game. If a player deposits money or purchases “convertible credit” to play against other players with the possibility of winning prizes, this type of product would typically qualify as an online money game under the ordinary definitions.

A “training version” of the product might fall into another category if there are no stakes or if the rewards are not in the form of cash.

These types of references do not provide evidence that a service is either lawful or registered or available in India. The legislation applies equally to all services provided in India regardless of where they were created. More important than where an operator is located or what their marketing refers to them as; is how the payment structure works, the reward system, and how the regulatory body determines if you are complying.

How Authority Decides Where Game Falls Under Online Gaming

The Authority may assess factors such as the nature of the game, whether users stake money or money-equivalent value, the scale of participation, and the financial structure of the service when determining whether a game falls into a regulated category. 

A decision as to where a game falls under online gaming may begin with the authority itself, or through an e-sports application by the provider or a government notification about social games. The timing of a determination depends on the applicable procedure and the information required by the authorities. Service providers may be required to provide information and cooperate with the Authority as part of the classification and compliance process. 

Payments, Advertising, and Safeguards for Users

Prohibition goes far beyond running a money game. The Act prohibits banks, financial institutions and other payment facilitators from processing funds for online money gaming services. Separately, it also prohibits any person from advertising or promoting online money games. Illegal gaming sites can be blocked through the Information Technology Act (2000). Anyone who offers or facilitates an illegal money game could receive up to three years in prison and/or fines as high as ₹1crore. Anyone who advertises an illegal money game could get two years in prison and/or fines of ₹50 lakh.

There will be varying levels of oversight based on permissible categories. These could include age verification, parental control settings, time limits, reporting tools and fair-play monitoring.

India’s regulatory body divides money stake from play that is competitive and recreational, provides a formal method to classify all forms of gambling, and unifies the regulation of payments, advertisements, and user protections into one entity.