Telangana govt targets RMG sector, sends legal notices demanding data

The Telangana state government has recently taken a firm stance against Real Money Gaming (RMG) operators in India, issuing legal notices to several platforms. Authorities are actively seeking detailed information regarding server locations, payment gateways, and user base demographics. Despite a longstanding ban, there has been a disturbing rise in cases where individuals have accessed banned betting applications through internet backdoors—resulting in severe financial losses and, tragically, a number of suicides.

According to a senior Telangana government official who spoke with Storyboard18, despite the explicit ban on online real money gaming platforms in both Telangana and neighboring Andhra Pradesh, many of these operators continue to flout the law. They reportedly offer services under the radar, exploiting legal and technological loopholes to maintain user engagement and revenue flow.

This enforcement action dates back to 2017 when the Telangana government enacted a stringent prohibition through the Telangana Gaming (Amendment) Act, 2017. This legislative update broadened the legal definition of "gaming" to encompass online platforms and even games of skill, provided they involve financial stakes. This amendment was intended to bring all forms of monetized gaming under regulatory scrutiny.

However, industry voices argue that the current enforcement efforts may be misdirected. A source from within the Real Money Gaming sector stated, “It appears that the Telangana government is uncertain about the kind of data it's requesting from legitimate operators. Most of the recognized platforms have already ceased operations within the state, and this has been formally communicated to the authorities. The primary issue remains the government’s inability to effectively curb illegal offshore betting and gambling operations.”

As enforcement actions intensify, RMG industry stakeholders are pushing for clearer guidelines from the state. There is concern around the level of detail being requested by the authorities, especially regarding user data and transaction records. One executive explained, “Releasing sensitive user information and financial transaction histories would violate privacy agreements and potentially expose platforms to legal challenges. Legitimate skill-based gaming companies are no longer offering services in Telangana or Andhra Pradesh, and we’ve made that clear.”

In the midst of this regulatory standoff, the Telangana government is preparing to host a multi-stakeholder consultation on an Online Digital Gaming Code. Scheduled for May 17 at T-Hub in Hyderabad, the event is expected to bring together representatives from the gaming industry, civil society, law enforcement, and policymakers.

A source privy to the developments noted, “The consultation aims to explore several critical issues, including the estimated revenue losses due to tax foregone in online gaming. Moreover, the government is seeking suggestions on how to create safeguards that protect citizens from socio-economic harm linked to online gaming."

Still, it remains unclear whether the government is open to the idea of allowing legitimate real money gaming firms to operate under a new, regulated framework. This ambiguity continues to cause unease among both gaming operators and legal experts.

In a related crackdown, the Hyderabad Police had recently filed criminal charges against registered a case against 25 celebrities and social media influencers, including prominent actors Rana Daggubati, Prakash Raj, Vijay Devarakonda, and Manchu Lakshmi, for allegedly endorsing illegal betting apps.

This development underscores the growing problem of online gambling promotion and the apparent violation of long-standing legal frameworks like the Public Gambling Act of 1867.

To further strengthen enforcement, the Telangana government is leveraging its Cyber Crime Division and Financial Cyber Crimes Wing to investigate illegal financial flows associated with betting applications. Charges of cheating and financial fraud are being considered against both influencers and app operators in an attempt to send a strong message to those involved in the unlawful gaming ecosystem.

However, it remains to be seen whether Telangana will move towards a more nuanced and structured approach to digital gaming—or double down on its prohibitive stance. For now, both the industry and stakeholders wait for clarity.