It has to be ascertained whether the cashback offers are being offered to create a new market by incentivising customers or to disrupt the competition in the existing market through predatory pricing, one CCI official said. Predatory pricing is an anti-competitive practice under Indias competition laws. It refers to a situation where a firm charges price below cost of production with the intent of forcing the competition to either immediately exit the market or exit after facing losses for a while. Once the competition exits the market, the predatory firm raises prices, economictimes.indiatimes.com reports.
Mobile wallet payments grew to more than USD 2.98 trillion (INR 200 trillion) in 2015-16 from just over USD 0.29 trillion (INR 20 trillion) in 2013-14. Several bricks-and-mortar retailers have complained to the CCI many times about the alleged practice of predatory pricing by the online market places. The All India Online Vendors Association also alleged that the cashback incentives offered by ecommerce companies and payment banks were against the recently released foreign direct investment policy.
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