Online games cannot be imagined without the digital payment feature. The first online gamers who played on rummy and poker apps used credit or debit cards for in-game payments. The adoption of these payment cards into the digital infrastructure proved to be the vital first step in online gaming. For the typical poker enthusiast, for instance, knowing how to play pokerwas not enough. You are expected to be equipped with the credit or debit card that made online gaming possible, particularly real money games.
Gradually, various other forms of digital transactions were adopted by the online games industry, revolutionising the way gamers and platforms operate. Apart from the deposits and subscriptions that contributed towards gaming revenues, new revenue sources like in-app purchases and different types of microtransactions are also unfolding. This has largely been possible due to the rapid adoption of digital transactions in the gaming industry.
Gaming in the Digital World
For gamers, digital transactions have been a versatile functionality in their game time. They can spend on real money games, subscriptions, virtual assets, and a host of other things that give them a better gaming experience. It was observed that 62% of gamers in India prefer to spend money on enhancements to an existing gaming app. These microtransactions are seen as the next big income in online gaming.
For a long time, India has been a market for sachets. From shampoos and hair oils to mouth fresheners and everything in between, the good things come in small packages for the Indian buyer. This is becoming a reality in the online gaming scene as well.
Keeping an eye on the propensity of Indian gamers to “spend less but spend often,” gaming platforms have gradually made gaming items available in fully knocked down conditions. You no longer need to invest in gaming packages and massive hardware. Almost everything in gaming is now available in pint size.
One may ask, how are digital transactions related to these new revenue models?
Enabling Frequent and Easy Payments
Using a credit card to purchase a paid gaming app or an annual subscription is convenient. But doing so for every little purchase may seem cumbersome to many. After all, the average single payment amount of the Indian paying gamer is as low as only ₹29. These are the types of payments that people love to pay with their UPI app, wallet, or other fast and new-age payment modes. Even people who know how to play poker games generally prefer to deposit in poker game apps like Pocket52 through UPI, wallets, crypto, etc.
The rapid adoption of these digital payment modes in India compelled all businesses to integrate them into their payment systems. Gaming companies must now offer various payment modes so that more and more gamers find their app convenient.
Apart from these payment modes, in-game currency is another reason that has accelerated spending propensity among gamers. Gamers are now accumulating or buying in-game coins and currencies and spending them on various virtual assets and services. Blockchain has been an influential presence in this regard. Blockchain is the technology behind the phenomenal rise of cryptocurrencies, which are now popular among gamers as well.
The ease and convenience of digital transactions have made gaming purchases simpler and more convenient for gamers. This has subsequently resulted in an increased spending propensity among gamers. This, of course, is good news for the gaming platforms as well.
Boosting Gaming Businesses
Thanks to the rapid integration of digital payment in gaming apps and their seamless adoption by gamers, gaming platforms are witnessing positive trends in revenue numbers. In the coming five years, in-app purchases are going to be the largest revenue channel for the gaming industry in India. The CAGR in this segment is expected to be more than 44% till 2029, which will ensure that in-app purchases exceed $4.3 billion by then.
Spending on real money games and other purchases is expected to remain stable at 8% CAGR between 2025 and 2029. In terms of segments, mid-core games have greatly benefitted from the uptick in in-app purchases. Beneficiaries include titles like BGMI, Clash of Clans, Roblox, etc. Buoyed by the popularity of in-app purchases, mid-core games registered a perplexing 53% year-on-year growth during FY24.
Going Digital
To sum up, the spike in digital transactions has greatly augmented the monetisation strategies of gaming platforms. This has happened largely because digital transactions have eased the payment efforts of gamers and brought affordable purchases closer to them. Digital transactions have proved to be the catalyst that has attracted more gamers into the ecosystem and resulted in higher revenue numbers with each passing year. As a result, players and platforms are more than happy with the surge in digital transactions.
