Bengaluru Restaurants Threaten To Boycott Swiggy & Zomato From August 15 Over High Commissions

Restaurant bodies in Bengaluru have warned that affiliated eateries could stop accepting orders through Swiggy and Zomato from August 15 if their concerns over commissions, discounts, and other deductions are not addressed by the platforms. The Bruhat Bengaluru Hotels Association and other restaurant groups have sought a written response from the platforms, demanding greater transparency in commissions and payouts, arguing that mounting deductions are eating into already thin profit margins at a time when operating costs continue to rise.

What are the restaurants demanding?

Restaurant associations say food delivery platforms levy multiple charges beyond their headline commission rates, including payment gateway fees, promotional charges, advertising costs, and deductions linked to discounts and loyalty programmes. BBHA president S. Subramanya Holla has reportedly said restaurants are currently paying commissions ranging from 8 percent to 28 percent, calling the charges unsustainable, and claimed that such high costs ultimately push up menu prices for customers since most restaurants don't operate on margins large enough to absorb them. He has also claimed that restaurants sometimes have to raise menu prices by as much as 43 percent just to recover platform commissions.

Restaurants have also demanded that platforms stop offering discounts without their consent, and have sought transparency in advertisement charges, payment gateway fees, and other deductions. Their key demands include stopping automatic deductions after customer complaints, compensating restaurants for cancelled orders after food has already been prepared, providing detailed settlement reports, ending one-sided agreements, and appointing dedicated relationship managers. PC Rao, honorary president of the Bengaluru Hotel Association, has reportedly alleged that Swiggy's unscientific deductions are causing heavy losses to restaurant owners, and that restaurants earning Rs. 1 lakh through the platform are often left with only around Rs. 40,000 after commissions, discounts, and other deductions.

Scale of the standoff and possible alternatives

More than 1,000 hotel and restaurant owners across the city have threatened to pull out of the apps starting August 15, accusing them of quietly slashing prices through hidden discounts, charging steep commissions, and squeezing already thin profit margins.

On alternatives, the growing dissatisfaction has encouraged restaurants to explore other options, with the government-backed Open Network for Digital Commerce positioning itself as a lower-cost option, while newer players such as Rapido have announced plans to enter the food delivery market with a lighter commission model. Even Flipkart is reportedly looking to enter the food delivery space.