Zomato Food Delivery App: The CCI dismissed a complaint against Zomato over the price difference between online and restaurant food. The commission considered the two business models to be different and called the comparison unfair.

Why is online food so expensive? CCI gives Zomato a clean chit

Online Food Delivery Charges: Nowadays, most people order food through online food delivery apps, which are often much more expensive than restaurants. If you've ever noticed while ordering food online that the food is more expensive on apps and cheaper in restaurants, then this news is very important for you.

A customer filed a complaint against Zomato (Eternal Ltd.) with the Competition Commission of India (CCI) regarding this issue. However, after investigating the matter, the CCI granted the company relief and dismissed the complaint. The CCI stated that online food delivery and direct restaurant purchases are two distinct business models, and therefore, prices cannot be directly compared.

What was the whole matter?

A customer complained that the price of food ordered online was significantly higher than at restaurants. He reported that a meal cost ₹105 at the restaurant, but the same meal was shown as ₹198 on the restaurant's app. The customer alleged that Zomato was overcharging customers through its app due to inflated menu prices, platform fees, delivery charges, and taxes. He also stated that Zomato's commission forces restaurants to increase food prices on its app.

Why is online food expensive?

• Online orders include costs for delivery, platform and other services.
• Due to the convenience of ordering food at home, one has to pay a higher price.
• Taxes, delivery charges and platform fees also increase the total bill.
• Food delivery companies charge a commission from restaurants, which the restaurants often compensate by increasing prices through their apps.

On what basis did CCI give a clean chit?

• CCI said that customers willingly pay higher prices for their convenience.
• All information like platform fees, delivery charges and taxes are shown to the customer before payment.
• The customer is given the option to cancel the order till the final payment.
• During the investigation, CCI did not find any evidence to prove that Zomato had taken undue advantage of its app.