Swiggy hikes platform fee to ₹15 per order, marking 3rd rise in 3 weeks

Food delivery platform Swiggy recently hiked its platform fee for the third time in the last three weeks. With the latest hike, the platform fee per order reached ₹15. The hike comes as the food delivery platform bets its hopes on the surge in demand during the festive season. 

Before this, Swiggy briefly raised its platform fee to ₹14 per order on Independence Day, before settling back at ₹12. Last month, Swiggy experimented with a ₹14 platform fee per order at select locations due to increased demand.

The platform fee is charged under the header saying "GST & Other Charges" along with charges like restaurant packaging, restaurant GST, as well as rain fee (on rain days). 

Given the platform's present order volumes of around 2 million orders per day, a higher fee implies up to ₹3 crore in daily revenue compared to around ₹2.4 crore when the platform fee was ₹12.

This translates to additional ₹54 crore per quarter and ₹216 crore annually. The platform fee hike comes at a time when Swiggy's net loss for the April-June quarter doubled to ₹1,197 crore annually due to higher investment in its quick-commerce arm Instamart.

The company's operating revenue, however, rose 54 per cent to ₹4,961 crore during the quarter. Its cash outflow stood at ₹1,053 crore after accounting for operating, investing, and financing activities. 

Not just this, the hike comes after its rival Zomato raised its platform fee from ₹10 to ₹12 to capitalise on the festive season rush. As per media reports, the fee also includes goods and services tax (GST). At its present order volumes of 2.3-2.5 million orders per day, Zomato would earn ₹3 crore daily and ₹45 crore per quarter. 

Zomato and Swiggy charge platform fees on every order, over and above other charges such as delivery fees, GST and restaurant fees. Platform fee is not uniform across cities and days and often differs on the basis of demand levels.