India Online Gaming Rules 2026 Create New Challenges for Operators

India's Promotion and Regulation of Online Gaming Act, 2025 (PROG Act), and Online Gaming Rules 2026 have introduced a nationwide ban on real-money online gaming while creating legal pathways for social games and esports.

The framework came into force on May 1, 2026, following a Supreme Court ban in August 2025. It prohibits games involving monetary stakes and potential financial rewards, regardless of whether outcomes depend on skill or chance.

Aaron Kamath, co-head of the Tech, Digital and Commercial Law Practice at Nishith Desai Associates, explained:

In practical terms, almost any format that combines a paid entry with a monetary or money-equivalent reward is now caught.

The restrictions also cover advertising prohibited games and facilitating related payments. Violations can result in imprisonment of up to three years and fines reaching INR 1 crore (approximately $106,000).

However, online social games can still generate revenue through subscriptions, advertising, access fees, and in-game purchases, provided these do not function as wagers.

Registered esports competitions may also charge participation fees and award performance-based prizes without betting.

Several major operators, including Dream11, MPL, Zupee, and PokerBaazi, suspended cash games following the Act's passage in August 2025.

Despite these changes, uncertainty remains around game classification, registration requirements, payment arrangements, and compliance responsibilities.

Further regulatory guidance is expected to clarify these requirements for operators and gaming providers.