Several sellers took to Facebook over the past few days stating that Flipkart has held back payments of up to 50-75% of the total amount due.

Seller association cries foul over delayed payments from Flipkart Group companiesImage for representation
Atom Ecommerce Tuesday, May 29, 2018 - 14:06

A week after writing to Competition Commission of India (CCI) objecting to the Flipkart-Walmart deal, seller associations now claim that Flipkart is delaying payments of various merchants.

Several sellers took to Facebook over the past few days stating that the ecommerce player has held back payments of up to 50-75% of the total amount due.

The company, however, claims that this it was only a technical glitch and that there have been no issues on payments with all payouts being made without any delay.  

All India Online Vendors Association, an association representing 3500 sellers, issued a statement demanding a regulatory to monitor the trade of ecommerce marketplaces and their policies towards sellers. The problem is allegedly being faced by all marketplace sellers.

It further claims that delayed and withheld payments have been attributed to technical glitch in the past as well.

According to them, Flipkart is wrongly claiming of informing sellers, when there has been no statement by Flipkart on their Facebook page or on Seller panel which is accessed on daily basis by sellers. 

“It has come to our attention today from sellers and through posts raised on social media page of Flipkart Seller Club that Flipkart Internet Pvt Ltd the marketplace running flipkart.com has held back payments upto 50% - 75% of the amount that was due to be made to sellers today,” it stated.

AIOVA, which has been vocal in demanding for a regulatory body to monitor the ecommerce industry, wants Flipkart group to be penalized for the delays to set an example for other marketplaces.

It has also written to the Commerce Ministry and Finance Ministry to intervene and regulate the payment system so that a repeat of financial fraud sellers have faced in the past with companies such as Askmebazaar.com and Best Deal TV.

Typically, based on sellers’ performance tiering, Flipkart has a payment policy of 7-15 days after a product is delivered

AIOVA claims that it has been regularly receiving complaints by sellers regarding payment delay by Flipkart-owned Jabong as well. In fact, a seller took to social media to share a screenshot showing a three-week delay in payouts.

According to AIOVA, myntra.com too, had similar problems earlier, which was settled after being reported.

“It is to be noted that ecommerce marketplace are acting as commissioning agents and payment collectors on behalf of sellers and withholding or delaying any payment is violating laws laid out by RBI as per Payments and Settlements Act 2007 which is a requirement to be followed as per FDI Guidelines prescribed by DIPP,” it said in a statement.

Also read: Trader association CAIT to move CCI against Walmart-Flipkart deal

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