Zomato hikes platform fee ahead of festive season rush

Eternal Ltd., the parent of food-delivery giant Zomato and quick-commerce app Blinkit, has raised the platform fee on food orders to Rs 12 from Rs 10, a 20% increase that comes just ahead of India’s festive season. 

The change, announced on September 2, is the latest in a string of hikes since the charge was first introduced at Rs 2 in August 2023.

Zomato, led by co-founder and chief executive Deepinder Goyal, has steadily ratcheted up the levy over the past two years, sometimes seasonally and sometimes permanently, as it seeks to offset delivery costs and bolster margins. The fee rose to Rs 3 in late 2023, to Rs 4 at the start of 2024, and climbed to Rs 5 in April that year. 

In July 2024, Zomato extended the fee to Rs 6 in major metros including Delhi, Mumbai, and Bengaluru. During last year’s festive season, it jumped to Rs 10, framed as a “festive platform fee.” The latest move lifts the charge to Rs 12, sparking a wave of customer frustration online.

Indian internet companies have increasingly leaned on such fees to squeeze revenue from consumers in a price-sensitive market. Rival Swiggy began charging a Rs 2 fee in April 2023 and has since raised it to Rs 12 in most cities, with temporary spikes to Rs 14 during the festive season.  

For Zomato, the incremental charges are not trivial. Analysts estimate the latest Rs 2 hike alone could add about Rs 15 crore in monthly revenue—roughly Rs 180–200 crore annually—assuming its average of 2.5 million daily orders holds steady. But the increases have drawn criticism from users who complain of shrinking discounts and vanishing offers even as platform fees climb.

The company is also contending with a weaker bottom line. Eternal reported a consolidated net profit of Rs 25 crore ($3 million) for the June quarter, down sharply from Rs 253 crore a year earlier, as investments in Blinkit and its going-out businesses weighed on results. Revenue rose to Rs 7,167 crore from Rs 4,206 crore. 

Zomato said Blinkit’s net order value exceeded that of its food-delivery business for the first full quarter, signaling a consumer shift toward rapid grocery delivery. Shares of Eternal rose about 2% after the fee hike announcement, reflecting investor confidence that consumers will ultimately absorb the higher charges despite grumbling.