Explained: How India’s new gaming regulator will classify and police online games

The Centre on Wednesday notified a long-awaited regulatory framework for online gaming, setting up a new authority, mandating classification of games, and tightening oversight of financial transactions and user safety.

The rules, titled Online Gaming Promotion and Regulation Rules, 2026, will come into force from May 1, 2026.

The rules provide for the establishment of an Online Gaming Authority of India, which will determine whether a game qualifies as a permissible online social game, an e-sport, or a “real money game”, and regulate them accordingly.

The authority, to be headquartered in Delhi, will include representatives from key ministries including home, finance, information and broadcasting, youth affairs and sports, and law.

Classification, registration mandatory

Under the new framework, online games will be subject to a “determination” process to classify whether an online game involves real money which the Promotion and Regulation of Online Gaming Act explicitly bans.

The authority will examine whether users deposit money, expect winnings, the structure of fees, and how rewards or in-game assets are monetised.

Such determination will be completed within 90 days of a complete application or of notice issued in a suo motu proceeding.

"...We wanted to, as far as possible, keep this entire thing as regulation-light as possible. Most games, which are not money games, should be able to operate with no obligation to necessarily either be determined or registered. So that entire process is optional," IT Secretary S Krishnan told reporters.

"We are not obligating anybody to apply to determine whether it is an online money game, or online social game, or esports,” he added.

Games identified as requiring oversight have to be registered, with separate certification for each title and service provider.

On successful determination and registration, the online gaming authority will issue a 'digital Certificate of Registration' with a unique registration number, valid for a period of up to 10 years.

"Registered service providers are required to prominently display the details of determination or registration on the interface through which the game is offered, designate a point of contact, comply with data retention directions, and observe directions issued in relation to facilitation of payments," an official release said.

Real-money games will not be eligible for recognition as e-sports under the framework.mm

Which games to get impacted

The Promotion and Regulation of Online Gaming Act has already forced major platforms like Dream11, Mobile Premier League (MPL), Zupee, and My11Circle to suspend operations that involve real money.

As the IT Secretary clarified, most of the casual or social games like Candy Crush Saga, Subway Surfers, Ludo King and Clash of Clans are likely to be least impacted.

Skill-based games like paid chess or quiz tournaments with prize pools, competitive e-sports with entry fees come under the grey area. In such cases, authorities will assess skill vs chance for determination or classification.

Tighter controls on payments, compliance

The rules impose strict conditions on financial transactions linked to online games.

Banks and payment intermediaries will be required to verify registration or classification status before processing transactions linked to online games.

In cases where a game is classified as a real money game, authorities can direct financial institutions to suspend or block transactions linked to such platforms.

Online gaming companies will also be required to maintain detailed records, including transactional and metadata information, and comply with periodic reporting and transparency norms.

User safety, grievance redressal

The framework mandates age verification, parental controls, time limits, and mechanisms to mitigate financial and psychological risks.

Service providers will be required to disclose their user safety features and internal grievance mechanisms at the time of application for determination or registration.

The authority will also have powers to investigate complaints, issue directions, and enforce corrective measures.

Penalties, enforcement

The rules lay down a structured process for inquiry and penalties in cases of non-compliance.

Violations could lead to fines, suspension or cancellation of registration, or even prohibition from offering specific games.

“Penalties are to be proportionate, with the Authority required to consider factors such as gain from non-compliance, loss caused to users, recurrence, gravity and mitigation efforts,” the release said.

Industry's response

According to industry players, the overall framework will prevent proxy real-money platforms from masquerading as e-sports.

Akshat Rathee, Co-founder and Managing Director of NODWIN Gaming said the rules bring much-needed clarity and structure to India’s esports ecosystem.

"For players, teams, tournament operators, broadcasters, sponsors, and other ecosystem participants, this creates a clear signal: once registered, an esport is unequivocally recognized as a legitimate sporting discipline," Rathee said.

Animesh Agarwal, Co-founder and CEO, S8UL said the norms bring much-needed structure to the ecosystem, clearly separating esports from online money gaming and helping address "long-standing confusion" around the space.

"For organisations like S8UL, this direction allows us to take a more long-term view - investing in talent, scaling teams, and building globally competitive structures with greater confidence," Agarwal said.

That said, important gaps that need to be addressed, he pointed out.

"Esports teams and players continue to face a lack of clarity on financial frameworks, with ongoing challenges in how banks differentiate between esports earnings and real money gaming. There is also no clear pathway today to formally register esports teams as entities within a defined structure," Agarwal said.

Vishal Parekh, Chief Operating Officer, CyberPowerPC India said that the rules bring structure and accountability to India’s gaming ecosystem.

"The introduction of clear guardrails and enforcement mechanisms will play a crucial role in building trust, not just among players and families, but also among global partners, brands and investors looking at India as a growth market," Parekh said.