Google rolls out third party payment feature for all Indian developers By CIOTechOutlook Team

Google rolls out third party payment feature for all Indian developers

CIOTechOutlook Team | Friday, 24 February 2023, 06:52 IST

All developers in India have been given official permission by Google to bill users for the apps and services they sell on the company's app store using alternative payment methods. The action was taken just over a month after the business issued a number of policy changes, including enabling downloads from third-party app stores on the Play Store, on January 25.

“In response to recent regulatory developments in India, we are now offering all developers the ability to offer an alternative billing system alongside Google Play’s for their mobile and tablet users in India. If a user pays through an alternative billing system, the Google Play service fee will be reduced by 4%," an update to the company’s official Play Console Help support page read.

For using its platform and payment mechanisms, Google currently charges developers a fee of 15% or 30%, depending on their annual Play Store income. With this update, developers who use third-party payment services, such as any alternative payment gateway for paid apps, services, and subscriptions, will receive a 4% discount on the commission. However, depending on how much money they make from their apps, they will still be required to pay Google 11% or 26% in commission.

The news comes after Google was collectively fined 2,273 crore (about $275 million) by the Competition Commission (CCI) in October of last year for abusing its market dominance and engaging in anti-competitive behaviour. Since then, Google has appealed the CCI decision to the National Company Law Appellate Tribunal (NCLAT), where hearings are currently taking place.

It's true that in September of last year, Google initially launched a trial programme with a restricted group of developers to enable third party billing. All developers in the nation would be able to accept third party payments, the company declared as part of its policy revisions on January 25.

Startups and developers, however, have claimed that Google’s reaction to the CCI orders are not in compliance. A statement issued on the matter by industry body Alliance of Digital India Foundation (ADIF) said that the update is “a clear violation of a specific direction of the CCI."

“Despite not using any service of Google’s, app developers will be forced to pay commissions. This is a clear violation… Google shall not impose any conditions, including price-related, on app developers that is unfair, unreasonable, discriminatory, or disproportionate to the services provided to the app developers. Further, there is absolutely no transparency as to why Google will charge 11% or 26% (commissions), even when the user avails a third-party processing service. This becomes all the more problematic, considering that most of the transactions carried out in the app digital ecosystem do not use Google Play Billing System," the ADIF statement said.

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