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  • Category: Miscellaneous

    Platform maintenance fees- have you heard it

    It is the first time I came across such a term. When booking flights tickets I have seen some similar fees and charges. In railways there is Platform ticket to enter onto a railway platform without having a travel ticket.
    But this platform fees, I faced and paid when I was at the checkout stage for an online purchase via Flipkart. The price of the product was 225, the shipping/packing charges 90 and the platform fees Rs3/-
    In the clickable info circle it was explained as "Fee dedicated to keeping the platform running smoothly and continuously improving your app experience." So much for that., whatever it may be.

    Are you aware of such platform fees? Is it there in other portals? What impact can this make on online purchases? Please discuss.
  • #782308
    This is quite strange and, I must say, a novel way to extract extra payment from buyers. I have heard of processing fees for online applications and online payments with bank cards, but for an e-commerce portal to charge such a fee is quite bizarre and, surely, unfair.
    When you make a commitment, you create hope. When you keep a commitment you create trust! ~ John C. Maxwell

  • #782311
    The online virtual world is now showing its true color to the people. I also experienced this issue while online shopping from a leading e-commerce website. They are charging 3 rupees for every online transaction that we do while shopping online. Even while doing online mobile recharge some banks are charging platform fee. Government is trying to promote digital economy and on the other hand they are imposing such charges, which I think will discourage online transactions.

    Many people have stopped doing online recharge now because of this platform fee. They just go the the mobile recharge retailers now, which is turning out to be a good thing for people who are running offline recharge business. Let's see what else is imposed on consumers in the coming times.

    Humble yourself or life will do it for you!

  • #782314
    I never come across this. I rarely book items online. My sons will be doing that. That is why I never come across this. These are all various tricks and ways to extract some additional money from the customers without increasing the cost of the item we are purchasing directly.
    As mentioned by Ajay, some banks are charging money for our online payments. If we pay bills through net banking online some banks are charging money. But UPI transactions are free so far.
    The earlier AP State government imposed a waste tax on the public. This tax is for the waste that is being generated by us. The present government removed this tax. When governments are doing such tricks, definitely private people will do much more.

    drrao
    always confident

  • #782343
    When I first see the title I thought it is related to railway ticket online booking. I didn't get into inside details. But yesterday when I watched Zee business there was a discussion in Zomato platform fee and then also initially wondered whether this app is also used for ticket booking. After that I came to this thread and read the details that there are many apps are getting platform fees for online shopping. Thanks for your first information on this.
    shasthranaam Ganitham moordhanisthitham

  • #782360
    When I read this topic yesterday, I did not aware about the fees. But today I ordered a mobile cover for my brother through Flipkart and surprised to see an amount of Rs.3- charged as platform maintenance fee. My brother too jovially told me that we are not ordered this by sitting in the railway platform.
    Now everything is to be borne by the consumer. In future there may be chances of charging even for browsing their website.

  • #782361
    I discussed this with my son. He said that some online trading companies may be charging this tax and the tax amount will vary from item to item. For some items they charge and for some items,
    drrao
    always confident

  • #782363
    I am doing online buys since many years. But this is the first time I came to see such a charging. I have seen it in only one portal yet.

  • #782366
    I am hearing it for the first time. Online stores charge money in the name of some fee like handling charges, packing and shipping etc but this is a new term.
    Knowledge is power.

  • #782401
    Lets try to understand platform fee by thinking about IndiaStudyChannel website.
    1. This website has a name called as IndiaStudyChannel and this name is put up somewhere. Think of it as a Birth certificate giving a name to this website.
    2. Then this website with the name IndiaStudyChannel needs physical space where all the website coding, articles, videos, photos are put up somewhere. This is called as Physical space , or server or some kind of digital space.
    Primarily, money is required for these 2 major kind of services where a name is held for this website and a physical space is needed.
    Without these two entities, IndiaStudyChannel website cannot exist.

    Now, as IndiaStudyChannel grew over the years, it needed more physical server space to host all of the articles, photos, videos, emails. Also the website name also became more costlier to be held. Thus the platform fee of IndiaStudyChannel increased over the years. Now had the admin of IndiaStudyChannel decided to get this money from its members in return of some physical or digital product purchase, then IndiaStudyChannel could charge a "platform fee" for each transaction that would happen on the website.

    What Umesh has mentioned about is if IndiaStudyChannel would had indulged in selling, then it could had charged fees that go to the courier shipping company.

    Thus Platform fee - would had been for IndiaStudyChannel to make that particular service available.
    Ola, Zomato, Uber and all such portals (also known as platform) charge a fee since they are providing their respective service and they are quite popular and unavoidable. But you can think about them as a way of earning for the particular platform.
    Thus if you didn't want to charge a platform fee, you would still be doing so, if you were to sell on other's platform like Amazon or Flipkart.

    So, if you consider, any online or offline platform is here to provide a service and is here to earn a profit of their platform, why would they be unfair in earning a platform fee? Infact they are bring honest that they are charging money for their services.
    Take an example of an Electrician. If you had some work in your home, you would call the electrician. The Electrician comes , checks your concern, says that he will go and buy the required part and install it for you. When you ask what would be the charges of his services, he says "No, my service cost is covered in the part of the electrical good". Now here is hidden business. As per MRP, the good may be costing 500 Rupees. But when the electrician goes to buy, it may cost him only 150 Rupees and he earns 350 Rupees for the service. Even worse, he might simply buy a dirt cheap good which may cost him only 50 Rupees and you do not realize that you have been charged 450 Rupees by the electrician to fit that Rs 50 product.

    Let us take an example of Google AdSense Revenue Sharing program. You write an article for IndiaStudyChannel and the website offers 90% revenue share for the article for 1 year. After 1 year, IndiaStudyChannel continuously earns 100% from your article. You are happy because you did not require to invest in building a website. But IndiaStudyChannel kept on earning for your write up over the next 20 years from your article. While IndiaStudyChannel did pure business relations with you, you actually did not know the real value of your write up.
    But here the business proposal is hidden from you and it may seem very well that IndiaStudyChannel duped you in the long run. This is because we saw short term gain that we did not need to make any website.

    Here instead, if IndiaStudyChannel would had offered an annual platform fees to keep the revenue sharing ongoing, it would had been a fair deal on part of IndiaStudyChannel to keep on earning money from its members. And for those who now did not want to pay for the continued revenue sharing, they could now have claimed complete ownership of the article and not receive the platform fee.

    Thus, when you do not know what is platform fee, it is incorrect to call upon and out rightly say that charging platform fee is unjust.

  • #782402
    I thank Apurva Tamhane for taking efforts and pains to explain the 'platform fees' as lucid as possible by citing example of ISC.
    Yes I can understand that.

    Every business has its own expenses and the same is recovered by various ways ,but mostly by loading it on the selling price. But some business do their own marketing method and show it under different heads -for their own accounting purpose and for allocating it to various partners and stakeholders.
    When we pay a trader or vendor by credit card or by other digital payment method, he also incurs a cost for such service. But if he separately quotes that charge then the buyer will feel wary of it and go to some other seller. Hence most traders either absorb it as their own expenses or load it partly or fully in their selling price.

    I think that now the platform fees is shown as a separate item -may be- for getting some benefit from statutory taxes or accounting benefits.
    The gold merchants sell by separately showing making loss and labor charges as two separate items- actually they are the profits apart from the price difference also.
    Some hotels bill for service charges also. Tomorrow what if he charges chair and table rental, fuel cost etc separately? The selling price is actually including of all the overhead and processing expenses and profit on the original cost price. That was how old straightforward accounting was.

    These are all gimmicks to fool or deceive the actual customers psychologically not feeling the escalated cost as it is shown not as price.

    The government also is to be blamed as they show the way by showing GST,IST, Cess, Surcharge, etc. For the ultimate consumer buyer these are amounting to the total price for him, because ultimately he is paying for all these from his hard earned -already taxed-money.

  • #782406
    The platform fee should be charged to the people selling their products on the platform because they are using the platform for their business. Why pass it on to the buyers?
    When you make a commitment, you create hope. When you keep a commitment you create trust! ~ John C. Maxwell

  • #782411
    As @venkiteswaran said sarcastically about the explanation, I feel sad those who availed benifits both financially and professionally(I meant positions like editor etc.,) in ISC and also its sister websites. When compared to my spending of time in ISC and revenue it is very very minimum and google AdSense also I never thought to apply due to other personal reasons I still wanted to be here. But for them you have agreed to the terms and conditions of this site and contributed, it is the wish of the members to be here. There is a tag line in one ad, there are different reasons to celebrate, there are different reasons to continue here.
    shasthranaam Ganitham moordhanisthitham


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