Centre probing e-commerce sites over new add-on charges

Charging extra fees for cash on delivery is a practice “classified as a dark pattern that misleads and exploits consumers, Union consumer affairs minister Pralhad Joshi said

The government is probing fees and various categories of additional charges levied by e-commerce platforms, especially for customers availing the “cash on delivery” option, Union consumer affairs minister Pralhad Joshi said on Friday in a social-media post.

The move to scrutinise delivery and other fees by online platforms comes during the annual festive season when shoppers throng markets and online sales peak. (Representative photo)

Charging extra fees for cash on delivery is a practice “classified as a dark pattern that misleads and exploits consumers”, the minister said. The move to scrutinise delivery and other fees by online platforms comes during the annual festive season when shoppers throng markets and online sales peak.

“A detailed investigation has been initiated and steps are being taken to scrutinise these platforms closely,” Joshi said, warning violators.

The minister made the revelation while replying to a post by a consumer on X showing a breakdown of charges levied by an e-commerce platform, including “offer handling fee”, “payment handling fee” and “protect promise fee”.

“Strict action will be taken against those violating consumer rights to ensure transparency and uphold fair practices in India’s growing e-commerce sector,” the minister said, replying to the post.

Dark patterns are tactics employed on a web page intended to lure consumers into making a choice or a transaction. For instance, e-commerce companies could use marketing ploys such as “limited-time offers” that actually never end or fake notifications that suggest a product is going to be “sold out soon”, creating “false urgency”. These tactics are illegal under the law.

Last month, the Central Consumer Protection Authority (CCPA) imposed a penalty of ₹2 lakh on Digital Age Retail Pvt. Ltd., which sells baby products under the FirstCry label, for false and misleading price representations, which are illegal under Sections 10, 20 and 21 of the Consumer Protection Act, 2019.

“The matter arose from a consumer complaint that FirstCry displayed products with the representation ‘MRP inclusive of all taxes’, while at the checkout stage, an additional GST was levied on the discounted price. This created a misleading impression of higher discounts and misled consumers about the final payable amount,” an official statement had said at the time.

Such practices fall under the category of “unfair trade practices” of the national consumer law. All e-commerce platforms have been advised to “take necessary steps to ensure their platforms do no engage in such deceptive and unfair trade practice which are in the nature of dark patterns”, an official said.