The Ministry of Electronics and Information Technology (Meity) has put forward a proposal that requires online gaming companies to practice self-regulation, require know-your-customer (KYC) for users and other things. The Indian government has recently announced that Meity will be responsible for handling all issues related to online gaming, with a particular focus on currency risks.
According to the proposal, a Self Regulatory Organization (SRO) should be established for the online gaming industry and gaming companies should have a physical office located in India with designated nodal and compliance officers. Meity recommends the introduction of a self-regulatory framework for the online gaming industry and the requirement for users to complete KYC processes in order to create an account for online games.
To create an account and play online games, players must first complete Know Your Customer (KYC) processes. Children under 18 years of age may not be permitted to play online games with monetary risks unless they have parental consent. Gaming companies will also be required to inform users about the potential risks of playing online games and the potential for addiction.
“The rules regulate betting. It is basically a prohibition of wagering on any game. The SRO will determine whether it is a permitted game or not. The online games that offer winnings, any game that allows wagering on the outcome is effectively a no-go area. If you bet on the outcome of a game, it is prohibited under 3(b) 10 of the IT rules,” Union Minister of State for Electronics and IT Rajeev Chandrasekhar said.
The government aims to protect players from monetary risks that may be associated with online games and ensure that such games comply with Indian law. To achieve this, user verification could help mitigate financial losses in games with monetary risks. The proposal states that online games will be required to display a registration mark that has been approved by the SRO. This is currently just a proposal, and the final rules are expected to be announced in February.
