Lightbox report says Non-Real Money Gaming shaping the industry’s future

Team L&M

Lightbox, a Mumbai-based consumer-tech VC fund, today released its report India’s Gaming Inflection: Non-RMG at Scale, outlining how India is set to emerge as one of the most significant gaming markets globally. With the second largest gamer base globally and the enactment of the Promotion and Regulation of Online Gaming Act, 2025, India is pivoting away from real-money gaming (RMG) towards a fast-growing, sustainable non-RMG ecosystem.

According to the report, India’s gaming story is unfolding now. With nearly 420 million players, it’s one of the world’s largest markets. Yet India is a paradox, among the highest in downloads but trailing in monetization. That paradox has also become its greatest potential, powered by a young, aspirational player base that is engaging more deeply, spending more widely, and making gaming a cultural mainstay.

From Volume-driven to Value-driven Market

Commenting on the release of the report, Sandeep Murthy, Managing Partner, Lightbox, said, “Indian Gaming is no longer a question of scale. Multi-faceted value creation is in progress. India can leap frog from volume driven market to value driven gaming giant. With policy clarifications, India’s young, mobile-first and multi-lingual gamers, emerging monetization avenues through in-app purchases, subscriptions and ads, the opportunity is huge. Our poll with Rooter reveals that almost three-quarters of gamers are already spending in non-RMG, both short and long session cohorts, with over 30% spending Rs. 1,000 per month. If provided with the right value, content, and community, Indian gamers will pay. We firmly believe that India can shift from being a volume story to a value story, fuelled by culturally relevant, long-lasting, and monetizable gaming experiences.”

• With the recent RMG ban, Non-RMG now stands to gain market share aggressively.

• The global gaming market at $177.9 billion in 2024 is projected to reach $198 billion by 2027

• More than 3.42 billion people play games worldwide, with nearly 420 million in India (China: 702 million, US: 221 million)

• In terms of ARPUs, the US leads with $215, China at $68, and India at just $3.03, underscoring the headroom for growth.

• 3 in 4 gamers spend on non RMG in-app purchases

The global gaming market is estimated at $177.9 billion in 2024, projected to reach $198 billion by 2027. More than 3.42 billion play games worldwide. China, India, and the US are the largest markets. However, in terms of ARPUs, the US leads with $215, China at $68, and India at just $3.03, underscoring the headroom for growth.

India had the largest gamer base after China in 2024, approximately 110 million daily gamers, growing at 5-6% CAGR. The Promotion and Regulation of Online Gaming Act, 2025 banned real-money games (RMG). Further, it outlawed their advertising and financial rails, and introduced strict penalties. This crystallised the regulatory risk around RMG while giving non-RMG games clear tailwinds and legitimacy. Earlier, RMG accounted for 83-86% of total revenues in the Indian gaming market. Non-RMG, which includes casual, mid-core, esports, and community-driven titles, now represents the fastest-growing opportunity.

Non-RMG games monetise through in-app purchases, advertising, subscriptions, and hybrid models. The FICCI-EY report projects in-app purchases in India will grow at 20% CAGR. Advertising revenue in the Indian gaming sector grew 10% in 2024, with casual and hyper-casual games providing platforms for brands to engage younger audiences across Tier I–III cities. Esports revenue in India stood at US$100 million in 2024, with sponsorships contributing 61%.

Lightbox’s report includes key insights from Rooter

• 9% of respondents spend on non-RMG in-app purchases
• 2% spending ₹1,000+ per month.
• Spending is not limited to heavy players. Both those who play over two hours daily and those who play under 30 minutes reported spending more than ₹1,000 monthly.
• Popular spend categories include battle passes and subscriptions (40%), cosmetics (37%), and unlockable content (23%).
• Language preferences: Hindi-first (34%), followed by Tamil and Telugu, with over 45% of Indian gamers preferring regional language content.
• 12% of the respondents find in game ads as ‘annoying’ while 38% said they would stop playing if the ad load is excessive signalling hybrid monetisation model for revenue generation
• 4% report that their playtime has  increased over the past five years
• For platforms and investors recalibrating after the RMG ban, the survey outlines a clear playbook.  UPI-friendly off-store payments for Rs 10–Rs 99 top-ups and Rs 99–Rs 129 passes; disciplined live-service cadence (events, drops, progression); hybrid  monetisation that combines small IAP with rewarded ads; and cross-device expansion to capture  higher-value users

The report identifies multiple growth drivers for India’s non-RMG sector: Hyper-localisation and culturally resonant content: Approximately 75% of Indian users prefer Hindi or other regional languages Game-Based Learning (GBL): Valued at $873.3 million in 2024, projected to reach $5.39 billion by 2033 Cloud Gaming: Estimated at $9.98 million in 2024, projected to grow to $1.3 billion by 2030 Artificial Intelligence: Used to generate hyper-local narratives, optimise monetisation, and enhance personalised gameplay