Indian group calls for cap on online gambling entry fees amid regulatory pressure
The growing popularity of real-money gambling, fueled by support from major cricketing figures, a sub-continental craze, has prompted regulatory efforts to tackle the risk of addiction, and reports of financial loss and suicides among young people .
These games could represent up to 53% of a games market that is expected to reach $7 billion by 2026, three times its size last year, according to research firm Redseer.
« The size of the banknotes should be regulated. It should not be more than 50 rupees. This is an addiction, » said Ashwani Mahajan, an official at Swadeshi Jagran Manch, which is considered to have a significant influence on the shaping Indian policy.
« We are going to talk about it with all the ministers concerned, » he told Reuters.
Although only equivalent to 62 US cents, the proposed cap is a significant proportion of the 25 rupees, or 31 cents, typically spent by 97% of users on an app such as Mobile Premier League, for example.
The remaining tiny 3% of users contribute 30% of the platform’s revenue by playing higher-ticket games, an industry source estimated.
Tuesday’s comments from the group, the economic wing of the ideological parent of the ruling Bharatiya Janata Party (BJP), come after a government panel called for the creation of a new regulatory body and recommended deposit and payment limits. withdrawal.
The measures, in a confidential draft reported last week by Reuters, alarmed an industry in which Tiger Global and Sequoia Capital have invested in fantasy sports game providers such as Dream11, MPL and Games24X7 which offer cricket and other paid contests.
Dream11 has a valuation of $8 billion, while MPL and Games24X7 are valued around $2.5 billion each, according to PitchBook data.
Although the panel report did not set a cap on fees, four gaming industry sources who spoke on condition of anonymity said such a move would affect the platforms’ revenue and growth potential. .
They promised to raise their concerns with the government.
India’s information technology minister, who set up the government panel, and some senior officials from ministries such as revenue and sports who are part of it, did not immediately respond to a request for comment.
MPL declined to comment. The other two companies did not immediately respond to requests for comment.
The new federal rules aim to resolve industry complaints about « inconsistent » Indian state regulations, divergent court rulings on games governed by skill or chance, and addiction issues, according to the panel’s draft .
Another concern for the industry is a government plan to have a regulator assess whether a game is based on skill or chance.
Such federal scrutiny, according to two sources, is likely to have a bigger impact on Sequoia Capital-backed MPL, since it offers around 70 real-money games, while Dream11 only has seven fantasy sports games, including cricket and soccer.
« Most mature industry players are well aware that regulation can only help, » Barde said.
« But the concern is that if approvals take an unusually long time, you may not be relevant in the market by then. »