India Plans Major Crackdown on Illegal Gambling Apps Breaching CCPA Rules

With illegal betting and gambling on the rise during election and cricket seasons, the consumer affairs ministry has taken action against indirect and surrogate advertisements that promote these activities.

According to two people with knowledge of the situation, the Central Consumer Protection Authority (CCPA) regulations are flagrantly broken by these advertisements, so the Center wants a crackdown.

The Ministry of Consumer Affairs has written to the Ministry of Electronics and Information Technology (Meity) requesting that they identify any of the violators and take the necessary legal action, which may include fines and the prohibition of betting and gambling app operations.

Betting and gambling are prohibited under the Public Gambling Act of 1867 and are illegal in most parts of India. Despite regulations, online betting platforms continue to advertise their services, leading to concerns about the financial and socio-economic implications, especially among the youth.

According to estimates, India’s gaming market is expected to reach $3.1 billion in FY23 and is projected to grow to $7.5 billion by FY28. India is the second-largest gaming market, with 15.4 billion game downloads in FY23. The largest is China.

“We don’t want to regulate regulators. Online gaming falls under MeitY’s purview, so we have asked them to review compliance issues with gaming apps and prepare a list of violators and the trend of its users,” one of two people cited above said.

After reviewing compliance adherence, a stakeholder consultation would be held to seek comments from online gaming platforms for strengthening regulations. This is aimed at protecting the targeted audience from addiction and falling into debt traps.

Queries sent to the secretaries and spokespersons of both ministries went unanswered.

Online gaming carries risks such as addiction, health problems from prolonged screen time, social isolation, financial loss due to in-game purchases, privacy and security concerns, cyberbullying, and negative influence from violent or aggressive games.

“Betting through online gaming apps is a serious issue, and the Consumer Affairs Ministry should take a strong stance on it. Betting apps are preying on vulnerable individuals, and the CCPA should implement stricter regulations to protect consumers and address their concerns. The surrogate advertising to catch unaware consumers as detected by ASCI every month needs to be tackled with a firm stand, specially the overseas operators ” said Ashim Sanyal, CEO and secretary, Consumer Voice.

The ministry is also supporting Bengaluru’s National Institute of Mental Health and Neurosciences (Nimhans) to conduct a study on disruptive impulse control behavioral patterns of online gaming that may cause vulnerabilities.

Framing guidelines

“The findings of the research will be used to frame guidelines for protecting consumers in online gaming,” the second person said, adding the report will also help the industry ensure the optimum use of technology to minimize risk.

The ongoing study aims to develop a predictive and preemptive model to protect the increasing number of digital consumers in the realm of online gaming on the internet.

Meity has scrapped the idea of a self-regulatory body for online gaming and is now working on establishing an independent regulator. This regulator will permit only registered entities to offer e-gaming services in India.