Does India Require a Regulatory Body for the Mobile & Online Games?

By Ankush Gera - CEO, Junglee Games
Tuesday, November 24, 2015
By Ankush Gera - CEO, Junglee Games
Headquartered in San Francisco, Junglee Games is a leading game development company that creates cutting-edge gaming technology and provides value-added gaming solutions. Founded in 2012 by Ankush Gera, Junglee Game is the fastest growing skill based real money gaming company for India.

Online and mobile gaming in India is a very lucrative industry and it is booming at a rapid pace owing to an endless list of gaming apps launching every day. Even the recent KPMG-FICCI study suggested that, the Indian gaming market will reach $700 million by 2017. On the social gaming side, gamers are ready to spend real money to purchase virtual currency to unlock higher levels and make premium purchases. Moreover, on the skill gaming side, gamers spend and play with real money, but they are limited to games of skill like Rummy. Online games in India have into a full-fledged economy with a well-developed demand and specific customer base. This form of gaming in India doesn't really need of a regulatory body as the central government and the Supreme Court have already clarified their legal positioning on it.

It is unauthorized activities like gambling and betting that are traditionally associated with money laundering, tax evasion and use of illicit funds. Regulators of all jurisdictions where gambling is legal have shown concerns of black money being used in casinos. In India, the Goa government amended the casino license conditions and issued guidelines to casinos, which included a collection of Know Your Customer (KYC) documents, reporting of transactions above Rs. 10 lakhs to the Financial Intelligence Unit (FIU) and maintaining special checks on Politically Exposed Persons (PEPs). While 'Games of skill' are governed by the IT act, it is the 'Game of Chance' that needs to be regulated.

The 'Game of Chance' has always held a certain charm for the Indian psyche from the days of the Mahabharata when the Pandavas lost their kingdom in a game of dice. In the present day, despite several attempts to ban it, betting continues, albeit in an underground way and substantial resources have been invested into enforcing such a ban. India has a hypocritical view of the fact that Rs.300,000 crore is what is illegally wagered on sports betting, leaving the bookies, mafia and perhaps even politicians to reap benefits from this unregulated industry. For games of chance and sports betting, the only way out is that the Government should think of legalizing and regulating betting in a way that it reduces the practice of match fixing in its bid to control the spread of existing illegal activities. It will also be able to save a huge amount of revenue in the form of taxes as well as the investments made in curbing it.

The greatest advantage of regulating sports betting is that there will be accountability for the large amounts of money transferred through illegal channels leading to a reduction in cases of match fixing, money laundering and crimes. Now, the question is how to tax the money involved in gambling and devise a system which encourages betting operators to function openly. The state of Sikkim has already started issuing licenses which is a great first step. Hopefully 3-4 major states follow and we can take pride in regulating gaming as a country as opposed to morally opposing it as a social evil, whilst fully being aware and turning a blind eye to the insane amount of illegal betting. A lot of the downsides of real money gaming on games of chance or sports betting will go away when it is regulated. This is why the U.K. and the U.S. and most countries in EU have regulated gaming. Australia was a late addition and now they've done the same.

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