Indian Start-Ups Demand Delay For New Google Payment System

Matthew Broersma,
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Group of Indian start-ups claims new Google in-app payment system allowing third-party providers charges ‘unsustainable’ fees

An association of start-ups in India has asked a court to suspend Google’s introduction of a new in-app billing system pending an antitrust inquiry.

In the Monday filing with Delhi High Court the Alliance of Digital India Foundation (ADIF) said Google’s introduction of its User Choice Billing system (UCB) should be delayed beyond the company’s planned 26 April implementation date until the Competition Commission of India (CCI) can hear a complaint over Google’s alleged non-compliance with CCI directives.

Google announced User Choice Billing after the CCI imposed a $113 million (£91m) competition fine on the company last October, ordering Google to allow the use of third-party billing in Android apps and stop forcing developers to use Google’s own in-app payment system, which charges 15 percent to 30 percent in commissions.

google playPayment fees

UCB allows alternative payment systems, but ADIF said in a confidential complaint last month, reported by Reuters last week, that the new system forces app developers to pay 1 percent to 3 percent for alternate service providers in addition to 11 percent to 26 percent to Google.

This makes “the entire ecosystem unsustainable”, the group said in the March complaint.

The latest filing says that the implementation of UCB should be kept “in abeyance” until the CCI can hear the ADIF’s complaint.

The court is likely to hear the plea later this week, Reuters reported.

Competition

Google has denied wrongdoing and challenged the fine.

Late last month an appeals court upheld a separate $160m fine by the CCI related to Android’s market dominance, but set aside four of the 10 antitrust directives imposed on Google.

Under the remaining directives, which Google is continuing to appeal, the company must take measures such as allowing users to choose their default search engine.

The penalty was similar to the EU’s 4.3bn euro (£3.8bn) penalty imposed in November 2019 over anti-competitive commercial practices related to Android.

South Korea’s trade regulator on Tuesday fined Google 42.1bn won ($31.88m, £26m) for working with local video game makers to attempt to block the growth of a rival app store in the country.