Gambling license in India

In 2023, the robust growth of India’s gaming sector soared to USD 3.1 billion and is projected to escalate to USD 7.5 billion by 2028. With a staggering 568 million gamers, of which 25% are paying users, India’s gaming community is thriving. This surge is fueled by a diverse array of games, encompassing real-money skill games, casual and social games, and e-sports.

Gambling laws in India vary from state to state in terms of regulation. While some states adhere to the Public Gambling Act 1867 (PGA), others have formulated regulations, such as the State Enactments. The article will delve into Nagaland as an illustrative case, showcasing the diverse regulatory landscape of gaming across India’s states.

Advantages of obtaining a gambling license in India

• A large domestic market.
• Opens doors to other significant regulators.
• Builds trust with players and partners

General requirements for obtaining a gambling license in India

• Foreign Direct Investment in India is regulated by the FDI Policy, backed by laws like FEMA and the Non-Debt Rules. Prohibited sectors include lottery business and gambling, covering both state and private enterprises, including online platforms and casinos.
• Most Gaming Enactments define “gambling” or “gaming” as wagering or betting for money or money’s worth, typically in games of chance. However, exceptions are made for certain activities, such as wagering on horse or dog races in specific circumstances, games of mere skill, and lotteries. These Enactments generally prohibit gambling but provide exemptions for games of skill.
• Operators must become members of designated Self-Regulatory Bodies (SRBs) and register their games under the IT Rules. 
• To be considered eligible, online real-money games must adhere to certain criteria. They must not involve wagering on any outcome, must be safe for children, must not contain surrogate advertisements, and must comply with all applicable laws, including those regarding minors’ competency to contract. Compliance with the SRB framework is also required. Licenses may be necessary depending on the product and the delivery method. Common types of licenses include those for online gaming, skill gaming, and fantasy sports.

Process of obtaining a gambling license in Nagaland, India

• Nagaland – The Finance Commissioner is the licensing authority for offering online games of skill. This authority can issue licenses for poker, fantasy betting, and skill games, enabling operators to offer these activities to players legally. 
• The license will be valid for five years, subject to compliance with any prescribed conditions, and will be deemed renewed every year thereafter as long as the license fee is paid.
• In Nagaland, licensees must be Indian entities with substantial holdings in India and a clean criminal record, with no involvement in online or offline gambling activities in India or abroad. 
• Licensees must provide the Nagaland Authority with a dashboard for supervision and may need to establish an office in Nagaland within 12 months of license issuance. 
• Technology support must be provided in India, including website hosting and server location.
• Applicants must have no criminal history.

The timeline for obtaining a license in Nagaland, India

In Nagaland, the licensing process involves submitting an application to the Finance Commissioner. If the Finance Commissioner is satisfied, they issue a letter of intent and forward the application to impaneled firms for scrutiny, who respond within 30 days. The Finance Commissioner may also refer the application to committees for further review, with recommendations due within 14 days. Upon receiving recommendations, the Finance Commissioner issues the license within 14 days, although there’s no strict timeline followed in practice.

License fees and ongoing annual fees

In Nagaland, an application for a gaming license must be accompanied by a non-refundable fee of INR 50,000. The ongoing annual fees are structured as follows:

• For the first three years, the annual license fee is INR 1 million for a single game or INR 2.5 million for a number of games.
• In the subsequent two years, the annual license fee increases to INR 2 million per game or INR 5 million for a number of games.

In addition, licensees are required to pay a royalty of 0.5% of gross revenue.

If you need a gambling license in India, contact SBSB Fintech Lawyers. We have been specializing in FinTech, crypto, and Gambling projects since 2013, providing tailor-made solutions for each client, taking into account the company’s business model. We will help you choose the most appropriate type of license and prepare the necessary documents to legalize your gambling business and obtain a gambling license in India in accordance with the law, providing full legal support.