Summary of this article
The Consumer Affairs Ministry has launched a formal investigation into e-commerce platforms charging extra fees for Cash-on-Delivery orders. Minister Pralhad Joshi said the practice amounts to a “dark pattern,” a deceptive design tactic that misleads consumers. Complaints surfaced earlier this year about hidden charges like “payment handling” or “offer handling” fees, sparking criticism on social media.
With ‘dark patterns’ becoming ever-more prevalent in online shopping, the Ministry of Consumer Affairs plans to open a formal investigation into e-commerce platforms. The Centre has called such dark patterns, especially hidden fees on ‘Cash-on-delivery’ (COD) orders and festive offers, as manipulative and exploitative for the consumers.
The investigation will be done on e-commerce platforms accused of sneaking in extra charges when customers opt for COD payments. Consumer Affairs Minister Pralhad Joshi confirmed this, describing the practice as a dark pattern that misleads buyers and undermines transparency in India’s booming online retail market.
Why this action now?
Complaints had been rising over platforms levying vague charges, from “payment handling” to “offer handling” fees, that only appeared at the checkout stage. The issue gained momentum on social media recently, when a user on platform X (previously Twitter) flagged hidden COD surcharges on grocery delivery apps and online marketplaces.
The user even compared these to the “rain fee” or “festival fee” levied by food delivery platforms, such as Zomato and Swiggy.
The Department of Consumer Affairs says such practices fall under what we call ‘drip pricing', one of 13 manipulative tactics officially recognised as “dark patterns” under the Consumer Protection Act, 2019. These patterns, ranging from false urgency messages to subscription traps, were formally outlawed through guidelines issued in November 2023.
In fact, a report released by the Advertising Standards Council of India (ASCI), last year found that nearly all top apps (majorly e-commerce, fintech and gaming applications), in the country use some or the other form of deceptive design that nudges consumer behavior.
Many consumers don’t even realise that they have been steered into paying more or giving away more data than they intended until after a transaction is made.
How the government is acting on such practices
This latest probe is part of a wider government effort to clean up digital marketplaces. Earlier this year, the Consumer Affairs Ministry directed companies to conduct self-audits and declare that their platforms were free of dark patterns. A joint working group with industry bodies, law universities, and consumer organisations has also been formed to monitor compliance.
According to some reports, the COD fee investigation will look into whether charges were clearly disclosed and at what stage in the shopping journey they appeared.
If any platform is found to have violated the consumer protection guidelines, they would face penalties, mandatory design changes, and/or stricter compliance disclosure rules.
During the festive season, consumers shop more to make the best of discounts and offers, and COD often remains one of the most popular methods, besides UPI and Netbanking. The probe on this matter would directly impact millions of consumers across the country.
Consumers too should be cautious while making online purchases and take a hard look at their final bill to check if there are any hidden charges on the final purchase.
