Online gaming ban: India’s UPI transaction value fell by Rs 2,500 crore in August 2025 after the Centre imposed a ban on online real-money gaming, leading to an immediate and visible impact on digital payments, according to newly released NPCI data.
Magnitude of the decline
During August, the gaming category processed 271 million transactions worth Rs 7,441 crore, down sharply from 351 million transactions worth over Rs 10,076 crore in July, a steep 25% drop in value within just nine days post-ban. Historically, real-money gaming alone accounted for more than Rs 10,000 crore each month, with annual turnover exceeding Rs 1.2 lakh crore before the ban, according to a report by MoneyControl.
Broader UPI trends
Despite the sharp decline in gaming-related transactions, total monthly UPI usage remained robust, clocking over 20 billion transactions in August (2,001 crore) with a total value near Rs 24.85 lakh crore. This minor dip represented only 0.5% of UPI’s monthly value and generally 1.5% of its transaction volume.
Sector impact and industry response
The ban has led to rapid changes: most real-money gaming firms halted cash-laden gaming operations within days, transitioning toward e-sports and social gaming, and triggering significant layoffs across the sector.
The gaming industry, which had annual revenues of over Rs 23,000 crore and 450 million active users, previously contributed around 10% of topline income for payment aggregators. For some months, like during IPL season, gaming soared to account for 2.5% of all UPI volumes.
Regulatory details and issues
Under the new law, real-money games were classified as illegal, penalizing operators, advertisers, and financial intermediaries with jail terms up to three years and fines up to Rs 1 crore. Most banks and payment platforms quickly ceased processing these transactions, seeking to avoid severe penalties. There are fears that users may migrate to international betting websites, which often evade direct monitoring by using foreign payment gateways and ambiguous merchant codes.
With UPI now accounting for 85% of all digital transactions and acting as the backbone for real-time payments, the sector’s ability to absorb the gaming ban highlights its scale and adaptability. Daily transactions surged past 700 million for the first time in August, despite disruptions in sub-sectors like gaming.
The sudden dip in UPI transaction value reveals the outsize influence of real-money gaming on India’s digital payments, but the overall platform remains strong and continues to expand.