One could say that 2025 marked the final act of the real money gaming saga with a bitter ending for startups. The RMG story started turning sour in 2023, when the first online gaming rules were introduced and later the clarification on 28% GST on real money gaming proceeds served to kill any momentum that was seen by gaming giants.

After two years of legal challenges and debate, the ban on real money gaming in 2025 was ultimate and final. It triggered the collapse of giants such as Dream11, WinZO, Hike, MPL, Gameskraft, Games24x7, and Nazara-backed Pokerbaazi, among others.

The abrupt ban, which came into effect in October 2025, set off widespread layoffs and the shutdowns of numerous startups. Despite pivoting, the largest of the real money gaming companies were forced to downsize. Some have had even more severe troubles in the aftermath.

The fallout peaked when the Enforcement Directorate (ED) arrested WinZO’s cofounders, Saumya Singh Rathore and Paavan Nanda after raids and the freezing of roughly INR 505 Cr in assets. According to the agency, WinZO kept running real money gaming offerings for overseas markets out of India despite the ban. There were also allegations of rigging and bots masquerading as real users.

All this means that the Indian gaming industry is in the post-RMG era. And for the gaming industry beyond the real money brigade, this is a major opportunity.

New rules finally offered clarity, a clear distinction between gaming categories, and explicit support for esports and online social games. This promises to bring more Indian games to the mainstream, and not just fantasy sports.

“We view regulatory development positively because they bring clarity and stability to the industry. Clear frameworks ultimately support players, developers and publishers, and help the industry mature more responsibly,” Sean Hyunil Sohn, CEO at KRAFTON India, told Inc42.

In particular, esports received a major boost with the inclusion as a demonstration sport at the Khelo India Youth Games 2025, after India’s debut in the esports event at the Asian Games 2022.

While the RMG ban had a chilling effect on funding, early stage gaming startups continued to attract capital from investors such as Krafton, and Bitkraft Ventures.

“What we’re seeing now, since the ban, is a wave of new startups emerging in interactive media and gaming and many founded by people coming out of the RMG sector. Middle-management professionals and young talent who left those companies, or were unfortunately laid off, are now building new ventures of their own,” Anuj Tandon, India partner at BitKraft Ventures, added.

This renewed activity is a positive sign because it brings clarity to the ecosystem. More people are choosing to build in this space. As gaming now stands at a very critical juncture, let’s understand how experts see this industry navigating the change and the key predictions that will define the Indian online gaming sector in 2026.

The Next Level For........

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