A recent investigation has revealed that deceptive practices are rampant across a significant majority of e-commerce platforms in India, with 97% of platforms engaging in hidden fees and data misuse. This widespread issue has sparked outrage among consumers and drawn the attention of the Indian government, which has launched a detailed investigation into the matter.
The probe was triggered by numerous complaints filed through the National Consumer Helpline, where users reported encountering unexpected charges during checkout, such as "Offer Handling Fee," "Payment Handling Fee," and "Protect Promise Fee". These fees, often vaguely named and not clearly disclosed upfront, can significantly increase the final cost of a purchase. In one instance, a consumer buying a discounted smartphone on Flipkart was charged an additional ₹226 on a product priced at ₹24,999.
Union Minister for Consumer Affairs, Pralhad Joshi, has taken a firm stance against these practices, referring to them as "dark patterns" – online tactics that manipulate or trick users into spending more than intended. He emphasized the government's commitment to protecting consumer rights and ensuring transparency in the e-commerce sector. The Department of Consumer Affairs is closely scrutinizing these platforms to determine whether they are clearly communicating all applicable charges, especially those specific to Cash-on-Delivery (CoD) orders, and whether these fees are optional or effectively compulsory.
The investigation comes at a time when CoD has become increasingly popular, particularly in smaller cities, making it crucial for e-commerce platforms to maintain transparent and fair practices. While CoD payments may involve legitimate operational costs for merchants, the addition of extra fees without clear disclosure could be a potentially deceptive practice under India's Consumer Protection Act. The government has warned that any violation of consumer rights could invite strict action, including financial penalties and directives to modify pricing practices.
Beyond hidden fees, concerns regarding data privacy and misuse are also on the rise in India's rapidly expanding e-commerce sector. The Economic Survey 2023-24 has cautioned that these issues are not isolated incidents but systemic threats capable of slowing growth. Data breaches at major Indian players like BigBasket, Zomato, and Flipkart have exposed the personal details of millions of users, eroding consumer confidence in online platforms. The rise in online payment frauds, with UPI-related frauds nearly doubling in 2023-24, has further exacerbated the situation.
To address these challenges, India has enacted protective legislation such as the Information Technology Act, 2000, and the Digital Personal Data Protection Act, 2023. However, enforcement gaps and issues of awareness remain stumbling blocks. Ensuring robust regulation, transparency in business practices, and consumer education are crucial to rebuilding trust in digital marketplaces and fostering the continued growth of e-commerce in India. As the investigation unfolds, consumers and regulators alike will be closely watching how e-commerce platforms adjust their practices and whether new regulations emerge to curb "dark pattern" practices in the digital commerce space.
