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Google Enables Alternate Bill Payment Methods for Indian Developers

CIO Insider Team | Friday, 24 February, 2023
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Google has now allowed all developers in India to bill users for apps and services purchased through the company's App Marketplace using alternate payment methods.

The move was taken just over a month after the business announced a number of policy changes, including enabling downloads from third-party app stores through the Play Store, on January 25.

The update comes after Google was fined a total of 2,273 crore (nearly $275 million) by the Competition Commission of India (CCI) in October of last year for abusive market dominance and anti-competitive behavior. Since then, Google has filed an appeal with the National Company Law Appellate Tribunal (NCLAT), which is currently hearing, challenging the CCI's ruling.

For using its platform and payment tools, Google now charges developers a fee of 15 percent or 30 percent, depending on their annual Play Store income.

“This can be seen as a blatant abuse of operating system market dominance, as the typical usage of a payment gateway interface is ideally around one to three percent for any online transaction. This commission rate can be challenged by startups as per CCI order.”

With this update, developers who use third-party payment services—such as any alternative payment gateway for premium apps, services, and subscriptions—will receive a four percent commission discount, bringing their total commission to 11 percent or 26 percent.

Google did first launch a trial program in September of last year to permit third party charging with specific developers. The business said on January 25 that it would make third-party payments available to all national developers as part of a revised policy.

Startups and programmers, on the other hand, have alleged that Google's reaction to the CCI rulings is not compliant. The upgrade is an obvious violation of a particular CCI guideline, industry group Alliance of Digital India Foundation (ADIF) stated in a statement on the subject.

On October 28 last year, Mint reported that startups are likely to step up their fight against the Google Play Store commission in light of the CCI’s decision. Ramesh Kailasam, chairman and chief executive of industry body IndiaTech, said at the time that the commission charged by Google “could kill the startup ecosystem, and force them out of the app economy.”

“This can be seen as a blatant abuse of operating system market dominance, as the typical usage of a payment gateway interface is ideally around one to three percent for any online transaction. This commission rate can be challenged by startups as per CCI order.”

However, the lawyers warned that Google is not strictly following the CCI order, as the CCI is not a market price regulator.

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