In a major setback for India’s real-money gaming industry, Bengaluru-based startup Gameskraft has reportedly laid off nearly 400 employees, a steep rise from the 120 job cuts announced earlier. The layoffs mark one of the biggest downsizing exercises in the sector since the government passed the Promotion and Regulation of Online Gaming Act, 2025, which effectively banned all real-money games across the country.
Credits: startuptalky
Struggling to Stay Afloat
The company confirmed to Moneycontrol that the decision was part of a broader administrative restructuring across teams and functions, calling it necessary for business continuity in light of the new regulatory environment.
“The changes brought by the new online gaming law have forced us to re-evaluate our operational priorities. Unfortunately, this has impacted roles across multiple departments,” the company said in a statement.
According to insiders, the scale of the layoffs may be even larger than disclosed. Sources indicated that Gameskraft’s total headcount has dropped from nearly 600 employees to under 100, suggesting a dramatic downsizing as the company repositions itself in a market that no longer supports its primary business model.
Gameskraft Navigating Through Troubled Waters
This isn’t the first time Gameskraft has had to make tough calls. In September 2025, the startup had laid off around 120 employees, citing the need to adapt to a shifting business environment. However, the latest round of job cuts underscores how deeply the government’s crackdown has affected the real-money gaming ecosystem.
Adding to the company’s troubles is an ongoing fraud investigation involving Ramesh Prabhu, its former Chief Financial Officer, who allegedly embezzled ₹270.43 crore over nearly five years. The case, filed at the Marathahalli police station in Bengaluru, has further complicated Gameskraft’s recovery efforts amid legal and financial uncertainty.
The company’s situation mirrors that of several other major gaming firms that have been hit by the recent legislation. Real-money gaming platforms such as Games24x7, Nazara Technologies-backed Baazi Games (Moonshine Technology), Mobile Premier League (MPL), and Head Digital Works (A23) have all been forced to lay off staff and suspend operations of their core money-based games.
A Law That Reshaped the Industry
The Promotion and Regulation of Online Gaming Act, 2025 introduced sweeping restrictions on any online game involving monetary stakes, whether directly or indirectly. The legislation’s passage marked a turning point for India’s gaming sector, which had seen exponential growth in recent years thanks to the rising popularity of fantasy sports, poker, and rummy platforms.
The new law prohibits games that require players to deposit or wager real money with the hope of winning cash rewards. As a result, many companies have been forced to pivot to non-monetary gaming formats or shut down their real-money operations altogether.
Several industry players, including Head Digital Works, have challenged the law’s constitutionality in the Supreme Court, arguing that it violates their right to conduct business. The next hearing in the case is scheduled for November 26, and the outcome could determine the fate of India’s real-money gaming ecosystem.
A Thoughtful Exit for Employees
Despite the difficult decision, Gameskraft has offered what it describes as a comprehensive severance package to support affected employees. The plan includes:
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One month’s pay for each completed year of service, capped at three months.
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Ex-gratia payment, notice pay, and up to 45 days of leave encashment.
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Health insurance coverage valid until March 2026, and term life insurance of up to ₹5 crore until June 2026.
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Job placement assistance, recommendation letters, and priority consideration for future openings.
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A waiver on recoveries related to relocation assistance and joining bonuses.
These measures reflect an effort to ensure that employees leaving the company do so with financial and emotional support during an uncertain time for the entire industry.
Credits: HR Katha
The Road Ahead
For Gameskraft, once considered one of India’s most promising real-money gaming startups, the road ahead remains unclear. With nearly its entire core business rendered illegal and ongoing legal disputes clouding its future, the company faces a steep climb toward reinvention.
As India’s online gaming ecosystem waits for clarity from the courts, Gameskraft’s massive layoffs serve as a stark reminder of how quickly regulatory shifts can reshape an entire industry — and the thousands of livelihoods connected to it.
