The Confederation of All Indian Traders (CAIT) has asked Union Finance Minister Nirmala Sitharaman to investigate the Rs 5 stores of Flipkart-owned Shopsy. But what is Shopsy?
Shopsy is a social e-commerce platform launched by Flipkart in July 2021. During its launch, Flipkart said that this app will enable Indians to start their own business without any capital investment. Based in Bangalore, Shopsy helps individuals and small businesses resell products through social media channels such as WhatsApp, Facebook and Instagram.
The app is available only for Android users and has managed to register 10 million downloads on Google Play, as of December 2021.
Shopsy users have access to a catalog of over 15 crores of products offered by Flipkart sellers. These range from fashion, beauty, mobiles, shoes to accessories. App users can share product catalogs with other customers. Shopsy users can then place an order for a particular product that their contact wants to buy. The product will then be delivered to this contact and the user will earn a commission on the transactions.
“Simply browse the product catalog in categories such as fashion and more. Share it with your friends, family and customers. And finally, add your profit margin, place the order and enjoy your earnings when the margin is credited to your account,” reads Shopsy’s app description on Google Play.
In December, Shopsy added a grocery category to its platform where users can earn a fixed 5% commission margin that will be credited directly to their linked bank account and enjoy savings of up to 50%. .
What is Shopsy Rs 5 store?
Rs 5 Store or Loot Store is a special offer offered by Shopsy in which some products are available at heavily discounted prices i.e. less than Rs 5. Delivery charges are also not levied on the products. However, customers can only use this store once per account per month. This offer is also only available at certain times of the day. Shopsy users can also earn commission on these transactions.
It is against these kinds of offers from Shopsy that CAIT has requested an investigation. The development was confirmed by CAIT General Secretary Praveen Khandelwal in a tweet.
Khandelwal tweeted, “CAIT also asked FM Smt Nirmala Sitharaman to investigate Shopsy by Flipkart’s Rs 5 stores.” he claimed that Flipkart was killing small merchants with predatory pricing and deep discount tactics. He added that this is also a flagrant violation of FDI laws.
CAIT also raised issues such as the lack of a level playing field for small merchants with Rs 5 stores by e-commerce companies like Flipkart and Shopsy.
Also Read: CAIT Urges FM Sitharaman to Probe Rs 5 Flipkart, Shopsy Stores