Amazon India adds flat ₹5 fee on all customer orders, Prime included

Business Standard

2 days ago

Amazon has introduced a uniform ₹5 fee on every customer order placed through its platform in India, a change that now applies even to Prime subscribers. The decision brings the e-commerce giant in step with rival quick-commerce services such as Blinkit, Zepto and Swiggy Instamart, all of which have implemented comparable surcharges in recent months. Flipkart, a key competitor, began levying a ₹3 fee on orders earlier this year, in mid-2024.
'Amazon is doing it as part of its monetisation strategy and following an industry standard set by others such as Blinkit, Swiggy and Zepto,' said Satish Meena, an advisor at Datum Intelligence, a consumer technology-focused market research firm. 'Customers don't have any other option not to pay.'
Industry experts observe that many platforms are introducing small fees on each order as a way to manage the growing costs of delivery operations, including transportation, staffing and fuel.
'E-commerce companies also have the confidence that customers are willing to pay for convenience,' said Meena. 'We may expect a further increase in this fee in the future by various e-commerce players.'
Amazon India has introduced the marketplace fee of ₹5 on every order since May.
This flat fee will apply to all orders, with exceptions for specific purchase categories such as gift cards and digital services, according to a company blog post.
The marketplace fee, which Amazon says is a common industry practice, supports the firm's commitment to offer millions of products from diverse sellers.
'It enables Amazon to offer a vast range of products from millions of sellers,' said Amazon.
At launch, the marketplace fee will not apply to gift card purchases, Amazon Business and Bazaar orders, or orders on Amazon Now and Fresh. It also excludes digital purchases like mobile recharges, bill payments, travel and movie bookings, insurance, Alexa skills, Fire TV apps, Prime Video rentals or purchases, subscriptions, and digital products delivered by email (e.g. software or Apple Store codes).
For Pay on Delivery orders or prepaid orders with other applicable fees (such as offer processing or exchange fees), the marketplace fee will not appear as a separate charge for now, as outlined in updated terms and conditions. It may still be combined with other fees, either fully or partially.
Amazon India does not disclose daily order volumes, but analysts say activity surges sharply during major sales events. In July last year, Amazon India said that Prime Day 2024 was the biggest Prime Day shopping event ever, with the e-commerce firm getting the highest-ever Prime member engagement and new membership sign-ups. Amazon India said a peak of 24,196 orders were placed by Prime members in a single minute (2024) as compared to 22,190 orders in 2023.
In November last year, Amazon India said its month-long Amazon Great Indian Festival (AGIF) 2024 witnessed 1.4 billion customer visits, the highest ever. More than 85 per cent of customers were from non-metro cities. Last year, Amazon India saw 1.1 billion customer visits on the platform during the event, with almost 4 million new customers.