Food Delivery Giants Swiggy, Zomato Hike Platform Fee to ₹10

28 Oct 2024 , 11:46 AM

Swiggy increased its platform fee on restaurant orders from ₹7 to ₹10 on October 24, following Zomato’s similar hike a day earlier, termed a “festive season platform fee.”

Both Swiggy and Zomato have raised the platform fee by 400% within a year, with Swiggy first introducing the fee at ₹2 per order in 2023 and Zomato following suit in August 2023.

The platform fee applies to all customers, regardless of membership in Swiggy One or Zomato Gold. Amid criticism and demand for clarification, Zomato stated that the fee hike is a routine business decision that varies by city.

Zomato shares dropped by 3.35% to ₹255 after the announcement, coming shortly after the company posted a net profit of ₹176 crore for Q2 FY24.

At the time of writing at 10:55 am on October 25, 2024, shares of Zomato is trading at ₹246.85 which is a 2.93% dip than the previous close. The stock has gained a total of 128% in the last one year, and 98% since the beginning of the year.

Social media users expressed frustration over the fee hikes, with some accusing both platforms of luring customers with low fees initially, then raising prices once dependency grew.

Influencer Ravisutanjani highlighted that both platforms now charge for GST, delivery, packing, and platform fees, despite starting with free delivery. The rapid rise of quick-commerce platforms like Blinkit and Swiggy Instamart has sparked concerns about their impact on local businesses and kirana stores.