On June 26th, the Indian Ed-tech Consortium (IEC) published a Memorandum on its website detailing how it plans to protect the interests of Indian ed-tech consumers. To address unethical business practices within the ed-tech sector, the Memorandum describes a professional ‘Code of Conduct’ for members to comply with—which appears to nudge members to develop ethical and transparent policies for marketing, sales, and financial policies. It has also established a two-tier grievance redressal system for users to raise complaints about ed-tech companies. The rest of the Memorandum’s chapters and annexures lay out a hierarchical self-regulatory mechanism for the industry that is seemingly granular in its details.
The Indian ed-tech industry is no stranger to controversy: this move may have come after the blitzkrieg of consumer complaints and negative publicity ed-tech companies have received over the years.
Government officials and members of the public alike have repeatedly criticised ed-tech companies for a range of unethical business practices: such as aggressive sales strategies, predatory payment schemes for its services, and exaggerated and unsubstantiated ads. Last December even saw the Union issue a circular to potential ed-tech customers—advising them to exercise caution before signing up for online educational platforms. An Advertising Standards Council of India report analysing complaints it received between April 2021 and March 2022 added that India’s education sector was the biggest violator of its self-regulatory advertising code.
Why this matters: With the proposed draft amendments to the IT Rules, 2021, the Executive has come down heavily on online ‘intermediaries’ for their ‘failure’ to develop effective self-regulatory grievance redressal mechanisms that protect users of the Internet in India. A new Executive-appointed appellate Committee will now take user appeals to grievances into its own hands—raising industry concerns over biases in decision-making. The ed-tech industry’s ability to avoid similar Executive oversight may partially depend on the efficacy of the Memorandum’s self-regulatory grievance redressal mechanism. Poor oversight, as the Ministry of Consumer Affairs warned the Consortium on July 1st, could potentially invite ‘stringent’ regulations from the Union.
The Internet and Mobile Association of India (IAMAI) announced the formation of the IEC in January this year. It is an autonomous, independent collective of Indian ed-tech companies seeking to build and uphold the ‘highest standards of quality’ and ‘professional ethics’. In short: this is the industry’s answer to self-regulating its excesses. Its members include the likes of Byju’s, WhiteHat Jr, and Vedantu, among others.
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Key Principles of the Code of Conduct
For ethical sales: In short, the bottom line appears to be, ‘what is told is what is sold’. Members are discouraged from mis-selling products, and from making unvalidated claims during a sales pitch. Any claims that are made should be backed up by ‘relevant’ statistics. Examples of students who have performed well after using a product should be authenticated by valid proof.
For marketing: A starting point for the industry is that all marketing and communication should aim to be ‘ethical and transparent’. If members are targeting minors or their parents, then they should comply with ‘truth-in-advertising standards’. A key issue raised: do not negatively target competitors in promotional material.
For ‘robust financing/loans/refunds’: Members should clearly and transparently raise consumer awareness of their financial policies, including their terms for ‘loans, financing, payment terms and refunds’.
The New Grievance Redressal Mechanism For IEC Members
How does it work now?: The IEC has established a two-tier redressal system. Tier I comprises an ‘Internal Complaint Forum by [the] IEC member’. Tier II comprises ‘self-regulation by [an] Independent Grievance Review Board’ (IGRB).
What kind of complaints can be raised?: Potential violations of the Code of Conduct, as filed by consumers, the government, or third parties. If consumers have filed a complaint with a government body or third party, they may forward it to either Tier—or even file a complaint on the complainant’s behalf.
What complaints are considered by Tier I?: Any consumer can file a complaint relating to a potential violation of the Code by a member of the IEC.
What complaints are considered by Tier II?: If Tier I complaints are not resolved by the internal forum within 30 days of receipt, consumers may escalate these to Tier II. Consumers can also appeal against the decisions made at Tier II within 30 days of receiving the verdict.
Tier I: An Internal Grievance Redressal Mechanism
How should it be constituted?: Each IEC member must appoint their own Grievance Officer—who is responsible for receiving complaints, and interacting with the complainant, IGRB, and the Ministry of Education. The Officer leads the Internal Complaints Forum for that IEC member. Members should also appoint a Compliance Officer, to ensure the entity’s adherence to the Code and relevant Indian laws.
How should it be publicised?: The details of the internal forum should be disclosed on the member’s website, and on marketing and promotional assets. Members should provide the name, designation, and contact details of the Grievance Officer on their websites.
What is the procedure?: The Officer should acknowledge complaints with complete information within 48 hours of receiving them. If the Officer believes that the complaint does not violate the Code of Conduct, they are to reply with their decision within a maximum of 15 working days from receiving it. If they need more time to decide, then they should let the complainant know of their tentative timelines—however, this should not exceed 30 working days from receipt. If the Officer believes a violation has occurred, it should tell the complainant within 30 days of receipt, and specify the remedial action to address the issue.
Things to remember?: Anonymised or pseudonymised complaints will not be entertained—neither will complaints with ‘incomplete’ information.
Escalating and Appealing Complaints
How to file an appeal/or escalate a grievance?: Under the format specified in Schedule VI of the Memorandum. Complainants can also withdraw their complaint by emailing the IGRB—however, the document does not specify the email address to do so.
What is the procedure?: The Secretariat (an administrative body managing the daily operations of the IGRB) will verify the validity of the application within 7 working days. Within 3 days, it will forward the application to the concerned IEC member—and may ask them to share information necessary in the verification process. IEC members have up to 3 working days to revert. The Secretariat may also contact the complainant to provide missing information necessary for adjudication—until this is supplied and verified, the complaint will not be considered ‘valid’. Once successfully verified and validated, the complaint is listed as a ‘registered grievance’ and assigned a registration number. The complainant and IEC member will be intimated of this.
Do all verified complaints make it to the IGRB?: No. A Screening Committee screens these complaints, whether physically or virtually, to ‘ensure faster and effective grievance redressal’. It conducts a preliminary assessment of complaints within 5 days of their registration. In the case of an appeal, if it believes the Code may have been violated, it will forward it to the IGRB. If not, it will send a response with its reasoning to the complainant—the latter can appeal this within 5 days of receipt. In the case of an Escalated Grievance, the Committee may forward the issue to the concerned IEC member—and direct them to redress within 7 working days. If this doesn’t happen, it will be forwarded to the IGRB.
How is the Screening Committee constituted?: Consists of 5 members—3 from the IEC Council (constituted by all IEC members), and 2 from the Secretariat. The IEC members on the Committee are elected by a simple majority and serve for 6 months. If a complaint pertains to a Committee member’s ed-tech entity, they will not be permitted to participate in the proceedings.
Tier II: Independent Grievance Review Board
What are its functions?: Ensure IEC member alignment with the Code of Conduct, guide the IEC Management Committee and IEC on the Code, and order expulsions for repeated non-compliance.
What is its jurisdiction?: It adjudicates on escalated complaints, or complaints not resolved by an IEC member within 30 days of receipt, and appeals to Tier I decisions. For appeals, its decisions are limited to issues of ‘Ethical Sales Practices, Transparent Marketing Communication, Robust Financing / Loans / Refunds’. It should pass a reasoned order within 30 days of the registration of the case.
How is the IGRB composed?: Comprises 7 members. The Chairperson is to be a retired Supreme or High Court Judge. 4 members are ‘industry experts’—and not employed with any IEC member. The remaining 2 are drawn from IEC Management Committee on a rotational basis, and serve terms of 6 months. The Chairperson and industry experts serve terms of two years.
Who are the current members of the IGRB?: Justice B.S. Chauhan (former Supreme Court Judge), Dr. Aruna Sharma (former IAS), Anand Sudarshan (Founder, Sylvant Advisors), Raj Nayal (Founder, MD, House of Cheer Networks), Gopal Jain (Senior Advocate, Supreme Court), Karandeep Singh (CFO, Simplilearn), Mohan Lakhamraju (Founder, CEO, GreatLearning).
How does it process complaints?: The Secretariat will inform complainants on when the IGRB will sit for their case. During the first hearing, the IGRB will conduct a preliminary assessment of the case. If further information is required from the appellant, complainant, or IEC Member, they may be requested to furnish it within 3 days of the first hearing—a second hearing will be listed no later than 7 working days from the first hearing. If a second hearing is required, the IGRB should ensure that the matter is closed expeditiously. Decisions will be made by way of a simple majority—the Chairperson has the deciding vote in the case of a tie.
Other important procedural caveats?: If a party to the dispute fails to appear for the hearings, then the case will be decided based on the merits of the information provided. Parties are allowed legal representation. A minimum of 3 IGRB members should be present for the hearings, including the Chairperson.
What happens if the complaint lacks merit?: During the first hearing, the IGRB will conduct a preliminary assessment of the case. If no violation is detected, the matter will be closed and the relevant parties informed.
What happens if the complaint indicates a violation?: It may contact the IEC member to remedy the alleged violation, while providing a reasoned explanation of its decision and of the remedy. If this is not implemented within 30 days, or if the member does not comply or adhere to the communication, or if this is the fourth open complaint for the member, then the IGRB will send an expulsion notice to the member. Members may appeal the notice within 15 days of receipt.
How is expulsion appealed?: An Appeals Review Panel (ARP) would be instituted—consisting of three IEC representatives selected by the IECMC within 20 days. They should represent a cross-section of the ed-tech industry, and ideally should not be a competitor to the appellant member. The ARP has 30 days to evaluate the appeal and make its decision. If accepted—the member has to close pending complaints within 15 days to retain membership.
Who are the signatories to the Memorandum?
- Aadarsh Technosoft Private Limited
- Bunch Microtechnologies Private Limited
- Class 21 Private Limited
- Cuelearn Private Limited
- Epowerx Learning Technologies Private Limited
- Great Lakes E-Learning Private Limited
- Harappa Learning Private Limited
- Interviewbit Technologies Private Limited
- Jaro Insttitute Of Technology Management And Research Limited
- Learnture Ventures Private Limited
- Pathfinder Publishing Private Limited
- Rankguru Technology Solutions Private Limited
- Simplilearn Solutions Private Limited
- Sorting Hat Technologies Private Limited
- Sunstone Education Technology Private Limited
- Think And Learn Private Limited
- Times Edutech And Events Limited
- Toppr Technologies Private Limited
- Unext Learning Private Limited
- Upgrad Education Private Limited
- Vedantu Innovations Private Limited
- Whitehat Education Technology Private Limited
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