CAIT asks FM to stop banks from offering cashbacks on online purchases

Traders’ body Confederation of All India Traders (CAIT) has complained to Finance Minister Nirmala Sitharaman against alleged collusion of banks with big e-commerce companies, such as Amazon and Flipkart, to provide cashbacks and incentives to a section of people and has called for a probe and immediate action to stop the practice.

ALSO READ Traders’ body charges Amazon of FEMA breach, seeks ED action

“In the present case, it has been noticed that several Banks including State Bank of India, Bank of Baroda, ICICI Bank,, Axis Bank, Citi Bank, HDFC Bank, Kotak Mahindra Bank, HSBC Bank, RBL Bank and others have entered into an unholy alliance with e-commerce companies prominently with Amazon and Walmart-owned Flipkart, forming a cartel and thereby granting 10 per cent cash back & other incentives in lieu of making payments using respective bank cards while purchasing goods from online portals...,” Praveen Khandelwal, National Secretary General, CAIT said in a letter addressed to the FM.

ALSO READ Govt moves to set up open e-commerce platform

CAIT asked the FM to take immediate steps to stop the practice and order a thorough probe into why banks were extending discounts only on purchase from designated e-commerce portals.

The traders’ body added that it has reason to believe that the banks, in collusion with e-commerce companies, are continuously conducting unfair business practices, which went against the ‘Fair Practices Code’ of banks.

“Surprisingly, till date, no auditor or competent authority has ever questioned this discrepancy and neither the Reserve Bank of India has questioned such a brazen unethical irregularity of business by the banks,” the letter stated.