After Boycott Calls, Swiggy To Refund Alleged Unauthorised Charges To Restaurants

After restaurateurs threatened to boycott Swiggy, the foodtech giant has reportedly agreed to refund promotional charges, which were allegedly levied on restaurant partners without prior consent.

Sources told Economic Times that the resolution followed high-level negotiations between Swiggy leadership and senior representatives from the Bruhat Bengaluru Hoteliers Association (BBHA), National Restaurant Association of India (NRAI) and Federation of Hotel & Restaurant Associations of India (FHRAI).

On Swiggy’s side, CEO Rohit Kapoor, CBO Sidharth Bhakoo and Swapnil Bajpai, who leads Swiggy Dineout and Scenes, were the key executives involved in the negotiation. 

Following the agreement, the industry bodies have now reportedly extended their deadline (to delist from the platform) to September 1 from August 15 earlier. The timeline has been extended to enable Swiggy to process the refunds and address the grievances of eateries. 

Notably, Swiggy’s rival Zomato is also facing similar demands. But the Eternal-owned platform also managed to secure a reprieve to extend the deadline for addressing the partners’ concerns after meeting with the industry representatives yesterday. 

More than 250 Bengaluru restaurants are threatening to delist from the two food delivery platforms due to concerns over unsustainable operational costs caused by inflated commissions, arbitrary extra charges and shrinking profit margins. 

The eateries are demanding an immediate halt to forced promotional levies and greater transparency in platform-led marketing initiatives. They are also seeking the establishment of a dedicated help desk to address operational and payout issues. 

The equation between food delivery platforms and restaurants has changed since the pandemic  as rising delivery orders are now claiming a significantly larger share of restaurants’ revenues, NRAI president and Wow! Momo cofounder Sagar Daryani earlier told Inc42. 

The standoff comes as India’s food delivery ecosystem is seeing renewed competition after years of near-total duopoly by Zomato and Swiggy. Earlier this year in March, Rapido also threw its ring in the hat and launched its food delivery platform Ownly. The app, which charges zero commissions from restaurant partners, claims to have captured nearly 10% of the city’s online food delivery market within five months of its launch. 

Notably, Walmart-owned ecommerce giant Flipkart is also poised to enter the industry soon as it is gearing up to launch its own food delivery service in select pincodes of Bengaluru by mid-August. 

The post After Boycott Calls, Swiggy To Refund Alleged Unauthorised Charges To Restaurants appeared first on Inc42 Media.