Snapdeal, flipkart

Snapdeal has refuted charges against it regarding non-payment of dues to sellers in a statement today. A few months ago, about 40% of Snapdeal’s sellers, around 2,000 merchants had severed ties with the e-commerce major because of non-payment of dues.

According to a Times of India report, all of these sellers belong to the All India Online Vendors Association (AIOVA) and claimed that Snapdeal owed them close to Rs.300-400 crore. A spokesperson of AIOVA had then stated that these sellers would go back to using the platform only if the e-commerce giant resolved these issues and provided a written statement of assurance.

Following this withdrawal from the  platform, AIOVA also wrote to commerce minister Nirmala Sitharaman requesting intervention to ensure Snapdeal paid its dues. This is the second such request to the minister from the Association. Further, it suggested the formulation of a regulatory body for e-commerce.

Earlier this week, AIOVA wrote to the commerce minister once more, in addition to the corporate affairs ministry asking for intervention on the upcoming Snapdeal-Flipkart deal.

According to several sources, Snapdeal’s largest investor SoftBank has been a proactive mediator between board members and very soon, a non-binding term sheet is expected to be signed by Flipkart, taking due diligence on the company it may acquire.

The Association stated that over 500 sellers still have pending dues with the homegrown e-tailer and if the merger were to ahead, they would lose all their money.

But in Snapdeal’s present statement, it refuted all charges against it and said that payments were made 6-10 times a month and sellers received their money within 3-5 days of their goods being sold.

Following so many charges, the e-tailer giant said that it is awaiting details in support of these claims from some sellers. Snapdeal’s Senior VP of Finance Operations Sanjay Agarwal said,

In these cases, sellers have so far failed to provide required justification for their claims despite multiple attempts by Snapdeal to facilitate these settlements.

Agarwal further added that these amounts are small and will get paid based on information provided by the concerned sellers and in accordance with their contracts and seller policies. The e-commerce marketplace has also claimed that the payments process has been sped up following the expedition of payment cycles for sellers.

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