India Targets Betting Payment Trails After ₹70,000 Crore Probe

India’s GST intelligence unit wants payment records to identify the website behind each transaction linked to online gaming. The proposal follows an investigation that detected ₹70,000 crore, or about $7.4 billion, in betting and gaming transactions during one financial year.

The Directorate General of GST Intelligence (DGGI) is looking beyond website blocking and toward the financial infrastructure used by illegal operators. Its recommendations were included in a report sent to the Central Board of Indirect Taxes and Customs earlier this month.

Payment Data Could Expose Proxy Merchants

Under the proposal, payment records would include the website that directed a user to make a transaction. Authorities also want disclosure of all bank accounts linked to a website’s GST registration.

The change is aimed at a gap in the current payment trail. Banks and payment gateways generally record the merchant receiving the money. An illegal betting site can instead send a player to an intermediary company. The payment record then shows that merchant rather than the gambling platform behind the transaction.

DGGI believes additional source data could help investigators connect those parts of the chain. It could also reveal accounts used to receive, transfer or layer funds.

₹70,000 Crore Is Transaction Volume, Not Revenue

The figure identified by the agency needs a clear distinction. DGGI estimated a ₹70,000 crore betting ecosystem based on transactions detected during one financial year. It did not describe that amount as operator revenue, gambling losses or unpaid tax.

The exact revenue loss and level of tax evasion have not been established. The wider inquiry remains open.

The findings came from a 14-month investigation that started as a GST evasion probe and expanded into the payment network supporting illegal online gaming and betting. Investigators found that intermediary merchant companies were being used to route money despite India’s restrictions on online money games.

Banks May Face New Reporting Duties

The proposal is still at an early stage. Banks, payment aggregators and other firms are expected to be consulted before any reporting requirement is introduced.

There is also a basic technical question to solve. DGGI has not said which party should record the website that sent a user to the payment page, or how that information would be checked.

For investigators, this is the main gap in the current system. A payment can be traced to the merchant that receives it, but that does not always show which gambling site started the transaction. Adding the source website could make some of those links easier to follow, especially where several accounts or intermediary companies are involved.