The National Restaurant Association of India (NRAI) has reportedly written to its members in the country, stating that online meal delivery providers Zomato and Swiggy have been generating money at the expense of eateries through their discount programs. According to a report, the NRAI warning refers to the Zomato Pay and Swiggy Diner programs, which are alleged to force eateries to offer discounts in exchange for commission fees on transactions. Swiggy Diner allows consumers to reserve discounted tables, whilst Zomato Pay is the company's payment facility.
According to PTI, the NRAI's advise claims that both Zomato Pay and Swiggy Diner do not charge clients a subscription fee to participate, while restaurant owners must offer discounts of up to 40% on the program.
Restaurants must also pay a commission of up to 12 percent on payment gateway transactions, whereas other gateways in the country charge a maximum of 1.5 percent, according to the NRAI's guidance.
The advise also wonders why eateries must pay a "middleman" commission to give discounts to their own consumers. According to the article, eateries must offer discounts to consumers who pay through the programs, even if they came into the restaurant on their own.
Zomato Pay is an online payment mechanism that allows users to conduct transactions on the service effortlessly, however customers can also pay using traditional payment methods. Swiggy Diner, on the other hand, is the company's service for booking inexpensive restaurant tables.
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"We are confident that we will create tremendous value and growth for the industry with our new dining product, which has now been live in Hyderabad for a few weeks with great results," a Zomato spokesperson told PTI, adding that the company was looking forward to working with "progressive restaurants who see the bigger picture." According to the report, a spokesman for Swiggy did not reply to a request for comment on the NRAI's allegations.
