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CAIT urges RBI to stop banks from offering cash back discounts on e-commerce platforms

payments, digital payments

The Confederation of All India Traders wants the Reserve Bank of India to direct banks to stop offering cashback offers on purchases made via e-commerce platforms. The lobby group, in a letter to RBI Governor Shaktikanta Das on Monday, said that banks such as HDFC Bank, SBI, and ICICI Bank among others only offer discounts on purchases made from e-commerce platforms, but when the same products are bought from brick and mortar shops, no such discounts are offered. CAIT called this alleged practice discriminatory.

The pressure group said that such exclusive cash backs to online shoppers “assumes the status of a cartel”. CAIT will file a separate complaint with the Competition Commission of India “demanding investigation against cartel between Amazon-Flipkart and Banks sinch such nexus is proving to be a death knell for the small businesses in India,” the organisation said in a statement.

Last week, CAIT had written to the Department for Promotion of Industry and Internal Trade that Amazon and Flipkart should be punished and penalised for “blatant violation” of India’s FDI policy and Foreign Exchange Management Act. In the letter, the organisation questioned Amazon’s alleged control over Future Retail via its stake in Future Coupons, its investment into More Retail, and Walmart-owned Flipkart’s investment into Aditya Birla Fashion Retail among other things.

Claiming to represent 70 million traders, CAIT has consistently raised voices against e-commerce companies and their “inadequate” regulation. At least since 2016, CAIT has opposed e-commerce entities for alleged FDI violations. In 2016, it complained to the then DIPP about alleged FDI violations by Flipkart. Ever since, it has opposed Walmart’s acquisition of Flipkart, then Amazon’s takeover of Aditya Birla Retail’s More Supermarket chain, and generally demanded stricter e-commerce regulations, including the need for a dedicated e-commerce policy and regulator.

In recent months, it has expanded its scope beyond e-commerce or retail, speaking up against Chinese investments in over a hundred Indian startups, many of which had little or nothing to do with e-commerce or retail trade.

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