Draft online gaming rules mandate refund to users within 180 days of law coming into force

The Promotion and Regulation of Online Gaming Act was passed in the Parliament in August

The draft Promotion and Regulation of Online Gaming (PROG) rules, released on October 2,  propose a 180-day window for gaming companies to repay the users funds owed to them before the new law banned money game.

The draft rules aims to operationalise the many provisions of the Promotion and Regulation of Online Gaming Act, which was passed by Parliament in  August. The law prohibits real money games, and promotes e-sports and other games of skill.

What does the rule say?

According to Rule 24 in the miscellaneous section, “any funds relating to online games due to be returned to users for which [th ey were] eligible prior to the enforcement of the Act… may be remitted to the users and such remittance shall not amount to facilitation of transactions or authorisation of funds towards payment for any online money gaming service.”

The draft clarifies that the repayment clause will remain valid only for 180 days from the date of enforcement of the online gaming act.

Why is this provision important?

The rule is designed to protect players who had deposits, balances, or winnings stuck with platforms that offered real-money gaming services before the Act came into force.

How will this affect platforms?

Experts Moneycontrol spoke to said the rule places a compliance obligation to identify and refund balances within the stipulated time. This may require ensuring proper KYC checks, and creating mechanisms to return funds even as their money-gaming operations wind down.

What happens after 180 days?

After the 180-day period ends, platforms will no longer be permitted to remit funds to users, as such transactions could be construed as facilitating prohibited money-gaming services.

What’s next?

The Ministry of Electronics and IT (MeitY) has invited feedback on the draft rules until October 31.