INDIAN FANTASY SPORTS INDUSTRY TO CONTRIBUTE INR 24,300 CR BY WAY OF TAXES: FIFS

The Federation of Indian Fantasy Sports (FIFS), India’s self-regulatory industry body for Fantasy Sports (FS), today unveiled the findings of a report titled ‘Fantasy Sports: Creating a Virtuous Cycle of Sports Development’ in collaboration with Deloitte. According to the report, India is the world’s biggest Fantasy Sports market with a user base of over 13 crore, which is expected to further grow at a CAGR of 32% in the coming years. The country has become a high-growth, in-focus market for FS due to factors like large tech-savvy millennial population, growing affiliation with sports, rapid smartphone penetration, availability of low-cost mobile data; and the market size is projected to grow from INR 34,600 cr in FY21 to an estimated INR 1,65,000 cr by FY25 thereby clocking a CAGR of 38%.

Cricket, the dominant sports on fantasy sports platforms, might see its share going to other sports such as kabaddi, hockey, football and volleyball which are growing in popularity but is expected to continue growing at 30% CAGR over the next four years and remain the highest contributor to the overall revenue of the fantasy sports industry. Women’s cricket has also gained popularity with fantasy sports; the first 12 matches of the 2020 ICC Women’s Twenty20 World Cup generated 4.1 crore viewing hours in India, a 213 per cent increase from 2018. During the Phase 1 of the 2021 edition of the Indian Premier League (IPL) alone, the FS industry user base in India grew by over 20 lakh users.

Key Highlights:

  • 50% of user transactions on the FS platforms have come in through tier 2 and tier 3 cities which not only promotes digital payment literacy but also increased engagement and involvement of population in sports through the grassroot level
  • Currently, it is estimated that close to 30% of the registered user base for FSPs in India is female users, a number that is expected to consistently rise in the next few years
  • Globally the FS user base has been male dominated with men accounting for 67% of the total revenue. Further, the male FS user segment is expected to grow at a CAGR of 14% over 2020–26
  • We can infer that the generation of INR 5,200 crore revenue, in FY21, would have created an indirect revenue of approximately INR 5,500 crore through its vendors and service providers. The total revenue attributable to FS (direct + indirect) is therefore INR 10,700 crore. It may also be noted that the indirect revenue will generate its own stream of GST as well
FIFS

FS Drives a Sporting Culture

“Fantasy sports industry is making huge economic inroads into India’s overall growth and development in multiple ways – creating highly skilled jobs, attracting foreign direct investment (FDI) and generating significant revenue for the exchequer. Besides, it is also propelling sporting culture and giving a boost to non-cricket sports as people tend to hone knowledge to participate in fantasy sports contests. Taking cognisance of the potential of this sector together with multiple favorable court judgements, primary government think tank NITI Aayog has released comprehensive guidelines for Fantasy Sports,” said FIFS chief executive officer (CEO), Anwar Shirpurwala.

I have added, “Recent positive developments viz., Rajasthan Government’s announcement to regulate games of skill, K’taka HC decision quashing law banning games of skill, Union Budget 2022 announcement to set up an AVGC (Animation Visual Effects Gaming Comic) Taskforce and Hon’ble Prime Minister Shri Narendra Modi’s statement on India’s potential to become a global hub of gaming sector, have together laid down a clear roadmap for growth of this industry. In another progressive move for the sports tech ecosystem, the state of Gujarat, in the blueprint of its Sports Policy recently, announced an incubator for sports startups and an athlete welfare programme. This will further bolster the growth of sports industry which has been sidelined from serious bureaucratic conversations till now”

Anwar further said that FIFS, as the only self-regulatory industry body for this niche sector, is fully committed to work with the Government, both at the center and in states to ensure growth of this industry and protect its users.

Sharing his thoughts about the sectorPrashanth Rao, Partner, Deloitte India said “Online Fantasy Sports has, over the past few years, witnessed unparalleled growth and widespread acceptance among the Indian Sports Fans. By leveraging cutting edge technology, developed locally, this sunshine sector is now emblematic of the Indian ‘Atma Nirbhar’ vision of self-reliance and growth. I believe that FIFS can help the sector unlock its true potential by encouraging responsible rule-based gaming and contributing to the development of the sporting industry in India.

NITI Aayog has recognized Fantasy Sports as a sunrise sector for India’s Digital Economy and has recommended a uniform national-level regulatory framework for the industry. Given widely available research into predominance of skill in FS, and landmark decisions from the Hon’ Supreme Court & multiple High Courts on FS format, there is merit to put in place a robust, unified national-level regulatory framework, bringing an end to the ambiguity and multiplicity of regimes. Such a framework, with checks and balances, would usher in greater accountability and transparency, improve the ease of doing business while also ensuring protection of user’s interest

About Federation of Indian Fantasy Sports (FIFS):

Formed in 2017, the Federation of Indian Fantasy Sports (FIFS) is India’s first and only Fantasy Sports self-regulatory industry body established to protect consumer interest and create standardized best practices in the FS industry. FIFS aims to create a thriving ecosystem for FS users and operators by creating guidelines for a common set of practices, setting standards of operation, and creating a regulatory framework to protect the FS user and operator interests. FIFS works with key industry stakeholders and liaisons with policymakers to create a robust governance structure to support the sustained growth of the industry. FIFS currently has 35 members.

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