Zomato hikes platform fee to Rs 12 ahead of festive season

Zomato has raised the platform fee on food delivery orders to Rs 12 from Rs 10, as demand is expected to surge during the festive season. This fee excludes goods and services tax (GST)

The move follows Swiggy’s recent hike, which pushed its platform fee to Rs 14 (inclusive of GST) in select pin codes amid rising order volumes.

Both Zomato and Swiggy had introduced the platform fee, which is a per order levy charges to customers, in 2023 -- and have gradually increased the amount since then.


The latest move comes amid tempering growth in the online food delivery segment. For the April-June period, Eternal-owned Zomato posted a year-on-year growth of 16% in gross order value at Rs 10,769 crore. This is slower than the over 20% growth it was clocking until few quarters ago.

"The strategy of raising platform fees ahead of the festive season and retaining the higher rate later has been in place since last year, when the fee was increased from Rs 6 to Rs 10. The platform fee has increased by 6x, since its introduction on Zomato platform," said Karan Taurani, executive vice president, Elara Capital.

He added that for every rupee of platform fee added, Zomato's take rates improve by 22 basis points. Taurani said that the move will accelerate Zomato’s target to hit 5% adjusted Ebitda.

Rising costs, quick commerce bets

Both Zomato and Swiggy are continuing to double down on quick commerce, even as their core food delivery businesses face pressure.

Zomato’s parent company posted a sharp 90% year-on-year (YoY) decline in consolidated net profit for the April-June quarter, at Rs 25 crore versus Rs 253 crore a year earlier, despite a 70% jump in revenue. Swiggy, on the other hand, saw its quarterly losses widen to Rs 1,197 crore, driven largely by investments in Instamart, while operating revenue rose 54% to Rs 4,961 crore.

The duopoly could soon be tested by Rapido, which recently launched a food delivery service called Ownly in Bengaluru. Currently live in Koramangala, HSR and BTM Layout, Ownly is positioning itself as a lower-cost alternative, charging restaurants commissions in the range of 8-15%, compared to Zomato and Swiggy’s 16-30%.