&imwidth=800&imheight=600&format=webp&quality=medium "'Offer handling fee': Why is government probing e-commerce platforms' cash-on-delivery?")
The central government has launched an investigation into allegations that e-commerce platforms have been charging their customers extra for making payments through the cash-on-delivery option. The action was taken after the government received complaints that the alleged extra charges misled buyers and violated consumer rights.
Here's what happened
On Friday, Pralhad Joshi, the consumer affairs minister, wrote on X that the Department of Consumer Affairs has initiated an investigation. He called such charges a "dark pattern".
He wrote on X that strict action will be taken against those engaged in such activities. He shared a screenshot of a user's order who was charged an "offer handling fee" of Rs 99, a "payment handling fee" of Rs 49, and a "protect promise fee" of Rs 79.
"The Department of Consumer Affairs has received complaints against e-commerce platforms charging extra for Cash-on-Delivery, a practice classified as a dark pattern that misleads and exploits consumers. A detailed investigation has been initiated and steps are being taken to scrutinize these platforms closely. Strict action will be taken against those violating consumer rights to ensure transparency and uphold fair practices in India’s growing e-commerce sector," he said in the post.
What are dark patterns?
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Dark patterns are deceptive tactics used by e-commerce, food delivery, and quick commerce platforms to trick users into buying their goods and services. Employing these tactics, some of these players even make it difficult for users to unsubscribe from memberships.
Ahead of the festive season, when people tend to make more discretionary spending, many of these platforms raised platform fees.
In June, the Central Consumer Protection Authority had ordered e-commerce platforms to eliminate dark patterns within three months after carrying out self-imposed audits.
The government has been taking several steps to boost domestic consumption. Last month, it eliminated the 12 per cent and 28 per cent GST slabs and moved these items to lower tax slabs.
The government has asked companies to pass on the benefits of the GST cuts. It is monitoring whether these companies have passed on GST benefits or not.