Mumbai: Consumers Raise Alarm Over Price Exploitation By Food Delivery Apps Zomato And Swiggy

Mumbai: Consumers are increasingly voicing concerns over price exploitation by food delivery apps such as Zomato and Swiggy. Many have complained about substantial discrepancies between the prices of food items in restaurants and those charged by the apps, sparking a wave of social media posts and calls for regulatory action.

One recent case that gained traction online involved Pratyay Banerjee, who posted on X (formerly Twitter) about the significant price difference he experienced. After ordering food from a local restaurant where his bill totaled Rs 370, Banerjee discovered that the same order would have cost him more than Rs 500 on Zomato.

Expressing his frustration, he tweeted, “(With) Price Difference between restaurant and Zomato’s order, soon Devinder Goyal (the founder of Zomato), will be able to buy an airplane.” The incident, first reported by Startup.pedia, has since sparked wider discussions about overcharging by these platforms.

In another case, Aslam Malkani, a Mumbai resident, reported a similar experience after visiting Delhi Zaika in Grant Road. Malkani ordered chicken malai seekh biryani for Rs 345, a bill copy shared with FPJ shows. However, the price for the same dish on both Zomato and Swiggy was listed at Rs 437, highlighting the inflated costs faced by customers using these services.

Restaurant owners have also expressed their dissatisfaction with the delivery apps. Rohan Chapekar, a Mumbai-based restaurateur who requested anonymity on his restaurant, explained, “Zomato charges a 25% commission along with 18% GST. To compensate, we provide Zomato with menu prices that are 25% higher than what we charge in the restaurant. Customers end up paying more, and we lose out on profits, while the delivery apps get richer.”

Another Mumbai hotelier, J.D. Shetty, who is a member of the Indian Hotel and Restaurant Association (AHAR) and owns Canara Hotel, shared his decision to stop using Zomato and Swiggy’s services. “These apps are a complete misguidance for consumers. They survive by relying on cloud kitchens operating in small, often unhygienic, locations. These kitchens, such as ‘ANDA APNA APNA’ in Malad, function from slum areas with minimal overhead costs,” Shetty told FPJ. AHAR has raised concerns about the safety and hygiene standards of such kitchens, which operate with minimal regulation.

Shetty also revealed that Zomato and Swiggy charge restaurant owners extra fees for priority listings on their platforms, with cloud kitchens often taking the top spots. “It’s a rigged system where restaurants like ours are pushed to the bottom, while low-cost cloud kitchens dominate the listings,” Shetty added.

Consumer activists have echoed these concerns. Mumbai-based activist Kamlakar Shenoy, who owns Sadguru Hotel in Sandhurst Road, stated, “These delivery apps have grown big because of the youth, who are willing to pay for convenience. But this convenience comes at a cost to both the customer and the hotel industry, which is left with minimal profits.”

Gaurang Vora, another consumer activist, emphasized that he had received multiple complaints regarding inflated prices. He urged consumers to file formal complaints with authorities and warned that the unchecked growth of these platforms could lead to further exploitation.

Pradeep Shetty, president of the Federation of Hotel & Restaurant Associations of India (FHRAI), said, “The price difference between a hotel and a delivery app is often due to the commissions, taxes, and delivery fees imposed by the apps. Hotels are forced to work with these platforms out of fear of losing customers, but the situation is detrimental to their business.”

FPJ reached out to both Zomato and Swiggy for their response to the complaints. While Zomato did not respond, Swiggy indicated that the matter had been escalated to a specialist team but has not provided further updates.

With consumers and restaurant owners increasingly dissatisfied, the debate around food delivery apps’ pricing practices continues to intensify, with calls for stricter regulations to protect both customers and businesses.