What started as a ₹2 "platform fee" to help keep the lights on has ballooned to ₹12.50 in less than 30 months, representing a 525% increase that has largely escaped public scrutiny until now. The fee structure employed by food delivery giant Zomato offers a case study in how India's tech sector is shifting from growth-at-any-cost to aggressive monetization—and how consumers bear the burden.
According to analysis shared on Reddit and verified through user invoice data, Zomato introduced its platform fee in August 2023 as a seemingly modest charge. The company, like many Indian tech startups that spent years subsidizing services to build market share, positioned the fee as necessary for operational sustainability. But the trajectory since then tells a different story.
The Timeline of Fee Increases:
• August 2023: Platform fee launches at ₹2 • January 2024: Increased to ₹4 (after a brief ₹9 "New Year's Eve special") • April 2024: Raised to ₹5 in metro cities • October 2024: Jumped to ₹10 (branded as temporary "Festive Fee") • Early 2026: Now sits at ₹12.50 plus GST
In India, as across the subcontinent, scale and diversity make simple narratives impossible—and fascinating. At Zomato's current scale of approximately 2.2 million orders per day, that ₹12.50 fee generates roughly ₹3 crore ($360,000) daily from this single line item alone—more than ₹1,000 crore ($120 million) annually. When the fee was ₹2, the same order volume generated only ₹50 lakh daily.
The Gig Economy Monetization Playbook
Zomato's approach mirrors a broader pattern across India's consumer tech sector. Companies like Swiggy (food delivery), Ola (ride-hailing), and Urban Company (home services) all followed similar trajectories: subsidize heavily to capture market share, drive out competition or force consolidation, then gradually increase prices once users are locked into the platform.
The "boiling frog" metaphor is apt. Each individual increase seems manageable—what's an extra ₹2.50?—but the cumulative effect is substantial. For regular users ordering food several times weekly, the annual cost increase runs into thousands of rupees. More significantly, the fee structure has become opaque, with platform fees, packaging charges, delivery fees, and GST creating invoices that require careful parsing to understand the actual cost.
What makes this particularly notable is that even Zomato Gold subscribers—customers who pay for premium membership—cannot avoid the platform fee. The subscription promises "free delivery" but excludes the platform fee, effectively making the "free" delivery a partial discount rather than true cost savings.
India's Tech Sector Pivot
Zomato's fee increases come as the company posted its first profitable year in 2024, ending a long period of cash burn that characterized India's startup boom. Investors, once content with user growth and market share metrics, are now demanding profitability and sustainable unit economics. The platform fee represents a direct pass-through of those financial pressures to consumers.
The company, founded in 2008 and publicly listed since 2021, has faced mounting pressure from shareholders to demonstrate a path to sustained profitability. After years of aggressive expansion, discounts, and delivery partner subsidies, Zomato now generates revenue from multiple streams: restaurant commissions (typically 15-25%), delivery charges, advertising fees, and the platform fee.
For context, Zomato and rival Swiggy together control approximately 90% of India's organized food delivery market, which serves a potential customer base of over 100 million urban consumers. This near-duopoly position gives both companies significant pricing power, particularly as switching costs increase—users have curated restaurant preferences, saved addresses, and membership benefits that create friction around moving platforms.
The Consumer Calculus
The question now facing millions of Indian consumers is when the convenience of app-based food delivery is no longer worth the accumulated costs. Many restaurants offer direct ordering through phone calls or their own apps, typically without platform fees or delivery charges. But consumer behavior, once established, is hard to shift—especially when the app interface makes ordering frictionless and provides features like order tracking and customer support.
The fee increases also intersect with broader economic pressures. Urban Indian consumers face rising food inflation, rental costs, and general cost-of-living increases. The cumulative impact of multiple small fee increases across different platforms—food delivery, ride-hailing, digital payments, streaming services—represents a meaningful dent in household budgets.
What's Next?
If the current trajectory continues, platform fees could reach ₹20-25 by 2027, according to user projections. Whether consumers will accept such increases or revert to direct ordering from restaurants remains to be seen. Much depends on alternatives: if Swiggy follows similar pricing strategies (which it likely will, given market dynamics), consumers have few options beyond changing consumption habits.
For India's tech sector, Zomato's approach may become a template for other platforms seeking profitability. The key lesson: gradual price increases, strategically timed and individually justified (festive season, operational costs, enhanced features), can achieve substantial revenue growth while minimizing user churn.
For consumers, the lesson might be different: read your invoices carefully, and remember that "platform" convenience comes with an increasingly high price tag. In a market economy, the question isn't whether companies can charge these fees—they clearly can—but whether consumers will continue paying them, or whether the boiling frog finally notices the temperature.
