HomeSponsored ArticlesWhy Are Some Cricket Betting Apps Banned in India?

Why Are Some Cricket Betting Apps Banned in India?

As the online gaming industry in India continues to evolve, it remains to be seen how regulatory developments will shape its future.

Cricket holds a prominent place in India, with millions of fans avidly following this beloved game. The introduction of fantasy sports and online betting platforms has enabled enthusiasts to dive deeper into the cricketing world. These platforms allow you to create fantasy teams, trade players, or place bets on match outcomes for monetary rewards.

While fantasy sports operate within a legal framework, online betting in India remains in a grey area with ambiguous regulations. Additionally, some betting platforms have incorporated features that violate norms.

Some of India’s top sports betting and casino apps are 1xBet, Parimatch, Mega Pari, Dafabet, and 10CRIC. These apps are still permitted to provide their services to the public. However, some other apps have been involved in fraudulent activities, which resulted in their ban.

Rise of Online Betting in India

There are various factors contributing to the growth of cricket and sports betting in India. Smartphones and affordable data have been key drivers of online betting growth, particularly among millennials. Today, more than 60% of 30 crore Indian online gamers prefer real-money gaming formats. Research indicates that the Indian betting market is already worth over INR 2 lakh crore and is expected to grow at a CAGR of 35% in the coming years. 

Betting on cricket matches accounts for over 60% of all bets. Features such as cash bonuses, fast withdrawals and user-friendly interfaces make betting platforms highly popular.

Industry estimates suggest that more than 5 crore Indians have used online betting services. Still, it is difficult to determine what percentage of Indian punters use legitimate platforms and how many do not. The issue with the industry lies in its grey area regarding legislation.

Is Online Betting Legal in India?

While each state governs gambling, only horse racing, lotteries, and casinos are legally permitted nationally. The 1867 Public Gambling Act prohibits operating or visiting gaming houses, but online betting sites can still offer their services to locals since current regulations do not cover online gambling. As long as these offshore platforms accept local currencies, they can accept Indian punters.

Most states have adopted the central Act locally, but a key difference exists between games of skill and games of chance. Fantasy sports require considerable skill and research in picking teams, so they are not pure games of chance and can bypass gambling prohibitions.

Online betting platforms argue that their outcomes rely on users’ knowledge, making them games of skill. However, legal opinions on this remain subjective. Unless regulated by states, operators risk liability under central and state gambling laws.

Why There Are Certain Cricket Betting Apps Banned in India

Why are some betting apps not allowed in the country while offshore sports betting apps can freely offer their services? Here are some reasons:

Violation of Regulatory Norms

While some e-commerce industries have thrived under self-regulation, the betting app industry has garnered intense regulatory scrutiny. There have been instances where betting apps have disguised themselves as fantasy sports platforms without proper licensing, leading to inevitable punitive action.

Fraudulent Practices and Scams

Several media reports have exposed scams perpetrated by fraudulent betting applications. These scams include not honouring bets, randomly deducting account balances without explanation, and coercing users to refrain from withdrawing funds.

Adding salt to the wound, illegal offshore betting apps have even used telecom channels to commit fraud and have been apprehended by authorities. The absence of customer redressal mechanisms further aggravates users’ grievances.

Concerns About User Data Privacy and Security

Some rogue betting apps require users to submit confidential information like bank statements during registration. However, these apps do not encrypt the data, making it vulnerable to theft. Additionally, these apps hoard all user behaviour data, making them vulnerable to hacking.

News reports have highlighted instances where users’ personal information was leaked from betting platforms to third parties without their consent. This reckless handling of consumer data is a cause for concern. Due to this issue, some betting apps, including MELBET, Silver Luck, and the Mahadev app, have already been banned in India.

On November 5, 2023, the Ministry of Electronics and Information Technology directed the Mahadev app and reddyannaofficial. in and 20 other apps and websites to cease operations. The Mahadev app had a franchise-like model with a profit-sharing ratio of 70-30% and was a significant player in the digital landscape. The app’s promoters had earned a staggering Rs 5,000 crore ($670 million) through the platform. This regulatory intervention follows the government’s previous actions, wherein over 100 lending and betting apps were banned earlier in the year.

What does the future hold?

Cricket betting applications promise entertainment and financial rewards, but they must be regulated strictly. Users must exercise responsible gambling practices, avoid apps with opaque practices, and report any illegal activities to the appropriate authorities.

As the online gaming industry in India continues to evolve, it remains to be seen how regulatory developments will shape its future. Ultimately, consumer welfare must guide the growth of cricket betting in India.

We can only wait and watch to see whether India moves towards national regulation of online betting activities.

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