India’s platform economy spanning e-commerce, quick-commerce, and ride-hailing, has largely welcomed the Centre’s move to operationalise the Code on Social Security (CoSS), 2020, terming it a necessary step toward formalising the country’s gig workforce.
The notification mandates aggregators to contribute 1-2% of their annual turnover, capped at 5% of the amount paid or payable to such workers, toward a social security fund. The industry’s immediate response has focused on the long-term benefits of regulatory clarity and workforce resilience. “The new codes provide a clearer and more predictable framework for businesses and workers,” said Rajneesh Kumar of Flipkart.
The chief corporate affairs officer at the group welcomed the move, adding that the company is reviewing the notification to ensure full compliance.
Amazon India’s spokesperson said the code aligns with their “existing priorities of providing safety, security, and welfare”, while Zepto said it means “stronger social security for our delivery partners, without losing the flexibility that powers quick commerce”.
Rapido described the move as vital for “long-term resilience and inclusion” of the sector, while Uber stated it looks forward to working with the government to ensure “speedy and effective implementation”.
Zomato and Blinkit-parent Eternal issued a voluntary disclosure to stock exchanges clearing the air on profitability concerns. “We don’t think any financial impact on account of these Rules will be detrimental to long-term health and sustainability of our business,” Eternal stated, adding that they had been “anticipating and planning” for these contributions for some time. The company noted that while the exact financial contours will be clear once the rules are notified, the reform is a “major systems reform” that supports the ecosystem.
Why platforms see CoSS as a ‘Major Systems Reform’
On-demand convenience firm Swiggy termed the newly notified labour codes as a “transformative step” that will unlock far-reaching benefits for millions of workers. While supporting the government’s vision of a modern and inclusive social security net, in a regulatory filing, Swiggy said it does not anticipate any material impact from the CoSS on its business sustainability, cost structure, or long-term financial performance.
Analysts tracking the sector echoed this sentiment, saying that they don’t expect compliance costs to go up considerably as most aggregator platforms have been provisioning for benefits like health and life insurance at some level. However, the new framework would standardise these efforts and bring in predictability in terms of financial planning, they added.
Compliance Conundrum
While the industry has broadly welcomed the move, experts are hopeful for clearer operational guidelines in the coming days, particularly around key definitions that will determine actual contribution amounts.
Sachin Alug, CEO of NLB Services, pointed out that the Code does not explicitly define what constitutes ‘turnover’ for aggregator platforms. “Should turnover be interpreted as GMV, NOV, or recognised revenue? Each of these measures can dramatically alter the contribution base, so clearer definitional guidance will be essential for consistent compliance,” he said.
Alug also highlighted concerns around the 5% cap on contributions. “If not framed carefully in the rules, it could unintentionally create incentives to restructure or suppress payouts.
The operational rules will need to build safeguards—such as transparent reporting requirements and a uniform payout classification—to avoid any scope for misuse,” he said.
Balasubramanian A, senior vice-president at TeamLease Services, while welcoming the intent of the move, said what isn’t clear yet is how the funds provisioned for welfare would be utilised. “The hope is for it to go towards health and life or term insurance and retirement benefits,” he said.
