CAIT CHARGED BANKS FOR CARTELISATION WITH AMAZON & FLIPKART
DEMANDED RBI TO TAKE PENAL ACTION AGAINST BANKS FOR UNHOLY NEXUS
new delhi, 27 nov.
Taking the cash back incentives & discounts offered by Banks on purchase of goods from e-commerce portals of Amazon, Flipkart and other e-commerce portals, the Confederation of All India Traders (CAIT) today levelled serious charges against Banks for making an unholy nexus with Amazon & Flipkart leading to infringement of Fundamental Rights of the traders & consumers, violating Preamble of the Constitution of India and FDI Policy of the Government. The CAIT has also charged the Banks for making a cartel with Amazon & Flipkart for promoting unfair practices.
“We shall be filing a separate complaint to the Competition Commission of India demanding investigation against cartel between Amazon-Flipkart and Banks sinch such nexus is proving to be a death knell for the small businesses in India”-said Mr. B.C.Bhartia, National President and Mr. Praveen Khandelwal, Secretary General of the CAIT.
In a communication sent today to Mr. Shaktikanta Das, Governor of Reserve Bank of India said that various schemes of the different Banks for giving 10% discount/cash back on a regular basis from time to time for purchase of any product from the portal of e-commerce companies Amazon & Flipkart. These Banks HDFC Bank, State Bank of India, ICICI Bank, Citi Bank, Kotak Mahindra Bank, HSBC, Bank of Baroda, RBL Bank, Axis Bank etc.
Mr.Bhartia & Mr. Khandelwal said that the above noted Banks are providing these cash discounts only on purchase of goods from e-commerce by making payment through their Debit/Credit Cards but if the same goods is purchased from a Brick & Mortar shop, this discount is not provided to the customers by any Bank. This act of the Banks clearly discriminates between two sets of traders thus violating Preamble of the Constitution of India which guarantees “Equality” and restricts the consumers to purchase goods from offline shops which violate Article 19 and Article 301 which gjjurantgees of Freedom of Trade and Commerce in the Country.
Mr. Bhartia & Mr. Khandelwal further said providing cash back exclusively to online shoppers through portal of Amazon & Flipkart assumes the status of a cartel which leads to providing help to Amazon & Flipkart for indulging into mal-practices of maintaining predatory pricing, exclusivity and creation of an uneven level playing field in the market which is specifically restricted under Press Note No.2 of the FDI policy.
Mr. Bhartia & Mr. Khandelwal said that it is a cartel between Amazon & Flipkart with Banks which also encourages unfair competition in the market which is prohibited under Section 3(1) read with Section 3 (3) of the Competition Act. Section 2 of the Competition Act among other things prohibits agreements which cause or are likely to cause an appreciable adverse effect on competition in India.
Under the circumstances narrated above, we request you to please take immediate cognisance of this matter and issue directives to the Banks to discontinue cash back offers with immediate effect and initiate proceedings as prescribed under the law against Banks for flouting banking norms and their dubious role in helping Amazon & Flipkart on the cost of offline traders-said the trade leaders.
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