Several Banks are giving cashbacks, incentives, and various other offers on purchase of goods from Amazon and Flipkart through their credit or debit card, said CAIT.
An ‘unholy’ cartel or nexus of Amazon and Flipkart along with brands and banks in a most strategic manner is deeply involved in ensuring predatory pricing and deep discounting, traders’ body Confederation of All India Traders (CAIT) said in a letter to Commerce minister Piyush Goyal on Sunday urging him to ask e-commerce companies to either follow the FDI policy in letter and spirit or shut their businesses in India. Calling for action against brands and banks as well apart from Flipkart and Amazon, CAIT termed the two e-commerce companies as ‘economic terrorist’ and a major roadblock to India’s vision of becoming $5-trillion economy.
“Serious steps should be taken against such companies who in the lust of enhancing the valuation of their respective company irrespective of incurring huge losses are greatly and bravely flouting the policy in a most crude manner throttling the businesses of small retailers,” Praveen Khandelwal, Secretary General, CAIT said. The traders’ body alleged that several brands owing companies are either selling their products to Amazon and Flipkart at a much lower price than offline market along with several products given exclusively only to e-commerce companies that empower the e-commerce companies to sell such products at much less cost.
Several Banks, said CAIT without disclosing names, are giving cashbacks, incentives, and various other offers on purchases of goods from e-commerce portals through their credit or debit card. “It is important to note that banks are giving this facility exclusively to e-commerce market and not to the offline market. These kind of facilities by brands and banks are much against the provisions of Competition law and policy of the Reserve Bank of India,” it added.
Goyal, in October this year, had cautioned e-commerce companies of strict action if they are found to be violating the policy. Khandelwal had met DPIIT Additional Secretary Shailendra Singh along with Flipkart Chief Corporate Affairs Officer Rajneesh Kumar and Amazon VP Gopal Pillai against the alleged violation of the FDI policy by controlling the inventory and influencing the prices of products sold on their marketplaces. Amazon and Flipkart, however, have been claiming full compliance with the laws governing e-commerce in India and that they are committed to the growth of small businesses in India along with employment generation and overall contribution to the country’s growth.