Zomato Raises Platform Fee by 25% and Suspends Intercity Service

Zomato increases platform fee by 25% to Rs 5 per order, aiming to improve margins and profitability.

  • Zomato increases platform fee by 25% to Rs 5 per order, aiming to improve margins and profitability.
  • The online food delivery platform suspends its Intercity Legends service, citing ongoing enhancements.
  • Zomato faces a GST demand and penalty order of Rs 11.81 crore for export services provided to foreign subsidiaries.

Zomato, a leading online food delivery platform, has announced a 25% hike in its platform fee, raising it to Rs 5 per order. The platform fee, a flat charge applied to all orders, aims to bolster Zomato’s margins and drive profitability. This increase follows previous adjustments, with Zomato progressively raising the fee from Rs 2 to Rs 3 and later to Rs 4, spurred by growing demand and operational costs.

In addition to the fee hike, Zomato has temporarily suspended its Intercity Legends service, signaling ongoing enhancements to the platform. The move comes ahead of the company’s March quarter financial results announcement, indicating strategic adjustments in response to market dynamics and business performance.

Despite operational developments, Zomato faces challenges, including a recent GST demand and penalty order totaling Rs 11.81 crore. The order, issued for export services provided to foreign subsidiaries between July 2017 and March 2021, highlights regulatory complexities in the digital services landscape. As Zomato navigates these challenges and adapts its business model, its ability to sustain growth and profitability remains a focal point for stakeholders.