Shares of Zomato saw a fall of 2 percent in the morning trading session of today i.e. April 5. Let us tell you that 2 top food delivery apps of the country have come under the radar of Competition Commission of India (CCI).
The CCI has said on 4 April that there is a need to investigate the business practices of Swiggy and Zomato. It is worth mentioning that both these apps are accused of adopting unfair business practices like delay in payment cycle, unilateral enforcement of rules and charging exorbitant commissions.
At present, around 09:50, this stock was seen at Rs 83.95, down by Rs 2.25, or 2.61 per cent, on the NSE. Till today, it has touched an intraday high of Rs 84.70 and an intraday low of Rs 82.15.
Let us inform that Swiggy and Zomato have been accused by the National Restaurant Association of India (NRAI) and on receiving a complaint about this, the CCI has decided to investigate the matter. CCI says that prima facie there are irregularities in the business practices of Zomato and Swiggy, which require investigation by the Director General. Only this investigation will be able to know whether these two food delivery platforms have adopted wrong trade practices by violating the rules.
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The CCI has asked the Director General to submit its report within 60 days. The National Restaurant Association of India (NRAI), which represents more than 50,000 restaurants across the country, says that Zomato and Swiggy’s non-competitive activities have seen a manifold increase during the coronavirus pandemic. Even after all the discussions and talks, Swiggy and Zomato have not taken any step to solve the problems of the restaurant.
NRAI alleges that the commission charged from the restaurant is unreasonable as it is being charged at a very high rate of 20-30 per cent. It has also been said in this complaint that about 27.8 percent commission is charged from restaurants listed on Zomato’s platform. On the other hand, this commission applicable on cloud kitchen can be up to 37 percent which is completely wrong.