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Fantok temporarily suspends its operations
Gurugram-based real money gaming app Fantok said it has temporarily suspended its operations as the recent GST council decision to impose 28% on online gaming continues to affect its business.
Founded in 2022 by Ronak Singh Ahuja, Prakhar Saxena and Ashok Vishwakarma, Fantok is a real money game to play prediction and opinion games hosted by social media influencers in short videos.
In a LinkedIn post, the company said the current regulatory measures in the real money gaming sector in India have presented complex legal hurdles in the business.
“Our legal advisors have indicated that the current environment creates uncertainties that we cannot ignore. The recent imposition of a 28% GST on the entire realized amount, coupled with high TDS and issues related to payment gateways, has further compounded these challenges. Additionally, the substantial cost of customer conversion has placed a significant strain on our resource,” the company wrote.
“In light of these circumstances, we have made the difficult decision to suspend operations at Fantok temporarily. This pause will allow us the time needed to explore a pivot that aligns with both the evolving regulatory landscape and our mission to deliver meaningful experiences,” the company added.
The startup claims to have over 15,000 downloads in its app and a community of over 130 creators who contributed games to the platform with a trade volume of over $120,000 or around Rs 99 lakh.
It’s worth mentioning that Fantok isn’t the only one that got hit by 28% GST. Other giant players in this sector, like MPL, were also hit by the GST Council’s decision, resulting in the layoffs of 350 employees or nearly 50% of its workforce.
Earlier this month, Spartan Poker laid off 125 employees, while Kavin Bharti Mittal’s Rush Gaming Universe reduced 22% of its workforce, citing the GST effect on the business.
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