3 April, 2016, Bangalore: One of India’s biggest online marketplace, Flipkart is now planning to file a case against all the companies that had used its platform for their online advertising but hadn’t paid for the service.
According to the person close to the news, “There are about 20 Indian and foreign companies which haven’t paid and the dues are in the range of Rs 90,000 to crores of rupees each.” Last month, Flipkart filed first such case in the Delhi High Court against a US-based computer data storage company Western Digital for allegedly not paying more than Rs 1 crore for placing ads on Flipkart, says people close to the news, reports ET.
Its competitor Snapdeal has found a perfect remedy for such issue, company uses a prepaid system for avoiding such matters. If any brand wants to showcase its product on Snapdeal, it has to make an advance payment to opt for the service. One the other hand, Flipkart doesn’t have any prepaid system and hence, it makes the company more open to face such payment issues.
However, the email sent to the company about the issue remained unanswered. “The digital industry is suffering because there have been several cases where advertisers default on payment. “We do not have a strong industry body in terms of payment collection yet. Payments for digital are cleared much after the payments of print and television,” said Amar Deep Singh, CEO, Interactive Avenues, a unit of IPG Mediabrands.