Zomato takes the next step- introduces ₹2 platform fee: Here’s what you need to know

Zomato tests ₹2 platform fee for select orders in certain markets, following Swiggy's move, aiming to boost profitability and user experience.

Zomato introduces ₹2 platform fee in select markets for Food Delivery. (REUTERS)

Zomato, the popular food delivery app, has embarked on a new experiment by introducing a flat ₹2 platform fee on certain orders in select markets. This nominal fee is levied per order, regardless of the cart value, applying to all users, including those enrolled in the Zomato Gold loyalty program. While the exact markets where the platform fee is being tested remain undisclosed, it appears to be an attempt to explore new avenues for profitability and enhance the overall user experience.

This move comes in the wake of a similar strategy adopted by its arch-rival, Swiggy, which started implementing a ₹2 platform fee on all orders earlier in the year. As Zomato seeks to strengthen its financial standing, the platform fee has been viewed as a potential measure to boost earnings and drive sustainable growth.

The Future of the ₹2 Platform Fee

A spokesperson for the Gurgaon-based food delivery giant confirmed to the Times of India, that the platform fee is currently in its experimental phase, and its long-term implementation will depend on the outcome of this trial. They explained that the company may or may not proceed with scaling the fee structure based on its effectiveness and user response. Zomato's recent success, marked by its first-ever quarterly profit of ₹2 crore for the June quarter, has been attributed to robust growth in its core business areas. The company's income surged by an impressive 64% to ₹2,597 crore in the same quarter, showing significant progress compared to a loss of ₹186 crore recorded a year ago.

Founder and CEO, Deepinder Goyal, expressed his satisfaction with the company's performance in a letter to shareholders, acknowledging that some of their seemingly risky endeavors have paid off and propelled the business forward. Despite a few challenging quarters, the food delivery industry witnessed a rebound in demand in recent months, which, in turn, contributed to Zomato's growth. As of June 2023, the platform boasted around 17.5 million monthly transacting customers, a testament to its position as a leader in the food delivery market.