Unveiling India's Digital Gaming Bounty: Revealing How Players Were Exploited and Annual Losses Amounted to a Mind-Boggling ₹20,000 Crores
In the bustling digital landscape of India, real-money gaming (RMG) platforms have been a growing phenomenon. From fantasy cricket and sports to rummy, Teen Patti, poker, and even online versions of casual board games like ludo or carrom, these platforms have tapped into a diverse audience.
However, the allure of these games has not come without consequences. Chip-based currency in some games abstracted real money losses, making them feel like games instead. This, coupled with the monetization problem solved by pay-to-play microtransactions, has led many players, particularly those from lower and middle-income groups, into a cycle of debt.
The economic impact was heavy, with courts estimating around 45 crore players/accounts losing over ₹20,000 crore each year. Many resorted to borrowing money, pledging assets, or even suicide due to unmanageable debts.
The Indian government, recognising the potential harm, recently introduced the Promotion and Regulation of Online Gaming Act. This has led to the halt of online games played with money on apps such as Dream11, MPL, Zupee, WinZO, MyCircle11, and PokerBaazi.
Yet, not everyone agrees with this ban. The company A23, founded in 2021, has challenged the ban, arguing that it is unfair and hinders business operations. A23 is the only known app to have reportedly moved the courts to challenge the ban.
The addictive nature of RMG is not solely due to monetary factors. The visual design of these apps, with Diwali motifs in rummy apps and stadium-type visuals during IPL season in fantasy cricket apps, makes gambling behaviour seem like part of everyday festivity.
Moreover, the science of why people keep playing and losing lies in how the brain processes risk and reward, with dopamine being a key factor. The most powerful driver of addiction in online gaming is the variable reward schedule, which produces stronger dopamine spikes than guaranteed rewards. AI-powered analytics track every click and hesitation of the users, potentially triggering personalized offers to keep them engaged and spending.
Near misses in online gaming activate the same brain circuits as actual wins, tricking players into feeling success is close, when in reality it is as far as the North Pole. Near-miss animations in these apps create a sense of being close to winning, even though the underlying odds have not changed.
Apps/platforms also use visual and auditory cues to keep players engaged, such as colour schemes, animations, sound design, avatars, and leader-boards. Many apps even disguise losses as wins, making repeated losses look less painful than they really were.
Payment systems in these apps add to the loop, nudging players to leave their balances in the app and play again due to frictionless deposits and slower withdrawals. The house rake, a fixed cut that platforms take from a contest pool, always profits the platform, regardless of who wins.
Despite the controversy, RMG generated ₹86 out of every ₹100 earned annually by the Indian online gaming industry, with some firms generating more than 95% revenue from RMG. Courts in India have repeatedly held that games like rummy and fantasy cricket are "games of skill" rather than gambling, which allowed platforms to operate in a grey zone.
However, the financial risks of RMG were not confined to one format and created financial risks for players, making its eventual collapse probably inevitable. As the Indian government continues to navigate this complex issue, the impact on both the industry and its players remains a pressing concern.
