Real-money games largest source of revenue for India’s online gaming market: report

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India has grown exponentially in the gaming sector over the past year with new paying users adding at 50 percent growth and the overall market is projected to reach 7 billion dollars in value by 2025 according to a recent report by RedSeer Consulting in association with Lumikai, India’s first gaming, and interactive media venture fund.

With the onset of the pandemic-induced measures, the ecosystem witnessed a marked acceleration in the gaming user base as well as investments into startups. According to the RedSeer report, real-money games (RMG) are the largest source of revenue for the market and in-app purchases (IAPs) will grow faster for the next 5 years at 30-40 percent with the rise of paying users in casual and hyper-casual gaming. Further, Non-RMG gaming segments are expected to grow faster than the market growth rate, with eSports and streaming are expected to grow at 40-45 percent CAGR for the next 5 years.

By FY26, RMG will likely account for 53 percent of total revenue followed by in-app purchases (31 percent) whereas advertisements are estimated to contribute 11 percent of the total revenue share.

“What has emerged is a picture of the market that already exceeds preconceived notions around size, growth, sophistication, and most importantly propensity to pay. India’s gaming market is due to 3x in value to over $7 billion by 2025, driven by a healthy diversity of monetization mechanics that indicate plenty of white spaces for new investment, and massive potential for a new generation of leaders across the gaming value chain. We’re excited to continue being at the forefront of India’s gaming investment landscape as the market matures and evolves to the next level,” said Justin Keeling, General Partner at Lumikai Fund told

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India currently packs a total gamer base of 425 million; out of which the paid gamers user base in India, according to the survey will be 235 million in 2025, a 3X jump from the number of such users — 80 million — in 2020.

In 2021, the estimated number of paid gamers in India is predicted to be around 95 million, which will grow by 25 percent to 235 million in 2025, as per the survey. A large chunk of the growth in the paid gamers user base in the country will be driven by casual, mid-core, and e-sports segments in the form of in-app purchases, tipping, etc.

According to the report, the inclination to pay for playing games online has increased across the country with the entertainment and engagement of the games being key factors. On average, a paid gamer in India spends $16 a year (Rs 1200) with monthly spends ranging from $0.6 (Rs 30) to $3.5 (Rs 230).

The report attributes the growth in the number of gamers in India to the maturity of the gamers, adaptability to play online as well as UPI integration within the gaming platforms.

“This is an exciting time for the gaming ecosystem in India. Access to gaming is democratized with increasing participation from Tier-2 cities and beyond, gamers are maturing in the way they play different gaming genres, and unprecedented growth in new-paying users (NPU) to drive the overall gaming market to become 3-times in the next 5 years. While real-money gaming (RMG) will continue to dominate the market, in-app purchases (IAP), virtual gifting, etc to become mainstream spend categories among paid gamers, and the revenue from IAP is expected to outgrow overall India’s gaming market growth rate,” said Mukesh Kumar, Engagement Manager at RedSeer to