India Tightens the Rules: Parimatch Analysts Examine How the Market Seeks New Formats

September 2025 became a watershed moment for India’s online gaming industry. That month, the country passed the Online Gaming Promotion and Regulation Act, which effectively prohibited real-money online gaming, its promotion, and payment processing. Analysts at the international brand Parimatch observe that against the backdrop of rapid market changes and law enforcement shifts, players and operators are searching for new behavioral patterns. From Parimatch’s perspective – a company with extensive experience analyzing Asian markets – this situation has become a textbook example of how excessive regulation can push an entire industry into the shadows.

A prohibition in one jurisdiction immediately reshapes user behavior and promotional strategies, redirecting them toward new digital platforms and external markets. For international brands like Parimatch, which were merely studying the potential of the Indian market, this development signaled a need to fundamentally reconsider their global expansion strategies.

What Exactly Was Banned and Why

The law, passed by parliament and signed by the president, criminalizes online real-money gaming as well as its promotion. Banks and payment services are forbidden from processing related transactions; violations carry fines and up to five years of imprisonment. As government officials emphasized, the decision was motivated by growing household financial losses and social harm: according to official estimates, approximately 450 million Indians (roughly one-third of the population) lose around $2.3 billion annually on online gambling. The law also declares support for developing non-gambling segments such as esports and social gaming.

According to Parimatch’s assessment, precisely this approach—implemented without any transition period or industry dialogue – creates the risk of a “gray” economy emerging, since demand for gaming services remains enormous.

Where Players Are Migrating

The regulatory shock hasn’t stopped demand: widespread migration of traffic to unregulated offshore sites is being recorded, with access provided through VPNs and proxy cards. Players themselves acknowledge they will “return to the old ways,” and circumvention practices will only become more entrenched. This drift increases behavioral and financial risks: offshore platforms operate outside India’s jurisdiction and consumer protection mechanisms.

At Parimatch, analysts emphasize that losing control over traffic leads not only to declining tax revenues but also to the proliferation of fraudulent schemes, which damages the industry’s reputation as a whole.

Parimatch and other international brands have become something of a benchmark for Indian users, despite the fact that the company never conducted operations in India due to legislative restrictions. The convenience and interfaces they grew accustomed to before the ban are now being accessed through foreign platforms.

Cricket and Fantasy Sports Ecosystem

The hardest hit fell on the fantasy segment, closely tied to cricket. India’s largest fantasy platform, Dream11, with approximately 260 million users, announced it would cease cash contests, transition to non-monetary prizes, and exit its sponsorship contract with the BCCI worth nearly $43 million, warning of revenue declines up to 95%. Previously, fantasy platforms’ share of IPL broadcast advertising revenue was estimated at up to 40%, and is now plummeting.

These shifts impact the entire funding chain of leagues and clubs. At the corporate level, international groups are also winding down “cash” products: Flutter withdrew Junglee, citing the absence of a transition period and consultations. The dynamics vividly demonstrate how swift prohibitions break complex “game-sport-media-advertising” connections.

Parimatch experts emphasize that in the fantasy sports sphere, it is precisely coordinated regulation that allows maintaining balance between business and public interests—an example India could follow in the future.

Law and Regulatory Policy

Legal challenges began immediately after the law took effect. Company A23 filed a constitutional petition, arguing the ban is disproportionate to its stated purpose and harms law-abiding companies. Analytical centers in Delhi note that under the guise of consumer protection, the state effectively shut down regulated Indian platforms while opening the door to “gray” offshore sites.

India’s Supreme Court is already reviewing a public petition proposing a unified approach to blocking illegal sites and strengthening control over financial operations through national banking and payment systems. The petition’s authors emphasize the scale of the problem: hundreds of millions of users and over fifteen hundred gaming apps already blocked.

Parimatch notes in its analytical reports that the key to market stability is legal certainty and dialogue between regulators and business, not blanket prohibitions.

How Companies at Parimatch’s Level Are Adapting

Although Parimatch never operated in India, the company is often viewed as a benchmark for global approaches to responsible gaming and marketing innovation.

According to industry associations, the real-money online gaming market was valued at approximately $3.7 billion and provided over 200,000 direct jobs, plus up to 300,000 when including ancillary services. After the ban, companies massively froze cash products, thousands of specialists lost their jobs, and advertising and creative industries lost major clients. Budget losses from uncollected taxes are estimated at approximately $2.5 billion annually. Meanwhile, some entrepreneurs have already announced plans to relocate their projects abroad, creating risks of capital flight and brain drain.

Some Indian gaming platforms are attempting rapid restructuring, transitioning to free-to-play formats and creating content services like Sportz Drip or FanCode, where users compete not for money but for points and prizes. However, such projects require significantly fewer resources and personnel compared to real-money games.

Simultaneously, international companies, including brands at Parimatch’s level, rethink marketing and audience retention strategies in similar crisis situations. They migrate users to legal products and adapt content and formats to different markets. Parimatch considers this approach a universal survival model for the industry, regardless of country.

New Demand Dynamics

Against the backdrop of India’s ban, interest is growing in “lightweight” betting channels: through messengers and SMS. These formats are perceived as convenient alternatives to traditional apps and content stores. Research by InPlaySoft notes that such channels win due to simplicity, accessibility in regions with poor internet connectivity, automation through bots, and even integration with cryptocurrency payments. At the same time, the importance of user identification procedures (KYC) and anti-money laundering measures (AML) is growing.

This is especially relevant for India: the stricter the restrictions on real-money gaming, the more actively players migrate to lightweight and often unregulated formats. As a result, the state faces a dual challenge: strengthen control and blocking while avoiding pushing users into the shadow segment.

As Parimatch analysts note, the displacement effect is a typical market reaction when harsh legislation creates conditions for uncontrolled niche development. The solution may lie not in prohibition but in creating clear frameworks for legal activity.

India’s ban demonstrated how quickly policy can reshape digital markets: consumer demand doesn’t “disappear” but redistributes among offshore platforms, “free” local products, and new channels where regulation is weaker.

Parimatch Experts Weigh In on the Future

Parimatch experts emphasize that the outcome of the confrontation between total prohibition and flexible regulation will depend on how effectively the state can offer players legal alternatives without damaging the sports industry. At the global level, Parimatch remains a compelling example of how an international brand can combine responsibility, innovation, and strategic analysis while respecting local laws and regulations.