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India’s tax intelligence agency has detected INR700 billion (US$7.4 billion) in illegal online gaming and betting transactions during one financial year and proposed new payment-data requirements to expose the networks routing those funds.
The figure covers transactions identified by the Directorate General of GST Intelligence, rather than operator revenue, tax evasion, or losses to the government. The exact amount of revenue loss remains under investigation, according to The Economic Times.
The findings emerged from a 14-month investigation into illegal online gaming and betting networks allegedly used for money laundering. A report was submitted to the Central Board of Indirect Taxes and Customs earlier this month, the newspaper reported, citing officials familiar with the matter.
Payment Records Proposal
The DGGI has recommended that payment records identify the website that directed a user to make each transaction. It also wants all bank accounts linked to a website’s goods and services tax registration disclosed, allowing investigators to map accounts used to receive, transfer, or layer funds.
Banks and payment gateways currently record the merchant receiving a payment. However, illegal betting platforms can direct users to proxy merchant companies, leaving investigators to establish separately that the merchant collected funds for a gaming website.
The proposal has yet to determine whether gaming platforms, payment gateways, aggregators, or banks would be responsible for recording and maintaining the information. Authorities must also decide how the originating website would be verified.
Consultation Underway
The recommendations are undergoing consultation because they could impose additional due-diligence requirements on banks and payment companies. The process will determine how the new data requirements would be applied and which entities would be responsible for compliance.
The DGGI’s report forms part of a wider effort to trace illegal online gaming and betting transactions. The agency’s investigation covered one financial year and identified INR700 billion in transactions linked to the networks under review.
Online Gaming Act In Force
India’s Promotion and Regulation of Online Gaming Act, 2025, prohibits online money games and bars banks and payment systems from processing related transactions. The supporting rules took effect on May 1, 2026.
The Act therefore provides the legal basis for restricting online money games and related payment activity. The DGGI’s investigation and recommendations operate within that framework, with the agency seeking additional payment-data requirements to support enforcement.
Investigation Covers Money Laundering Concerns
The 14-month investigation focused on illegal online gaming and betting networks allegedly used for money laundering. The DGGI’s report to the Central Board of Indirect Taxes and Customs covers both the scale of the transactions and the potential use of the networks for illicit financial activity.
The exact revenue loss to the government remains under investigation. The INR700 billion figure represents the transactions identified by the DGGI, rather than a final assessment of tax evasion or losses.
Next Steps For Payment Data Rules
The DGGI’s recommendations will continue through the consultation process. Authorities must determine which entities would record and maintain the required information and how the originating website would be verified.
The proposals aim to expose the networks routing illegal online gaming and betting funds. The DGGI’s investigation identified INR700 billion in transactions during one financial year, while the Promotion and Regulation of Online Gaming Act, 2025, prohibits online money games and related payment processing.
The consultation will therefore shape how the new payment-data requirements are implemented and which parties would be responsible for compliance. The DGGI’s report provides the basis for the proposed rules, with the exact revenue loss still under investigation.
Source: Asia Gaming Brief
