Flipkart is going after 20 brands over payment defaults, seeking to recover crores

Flipkart is filing cases against brands that have allegedly not paid for advertising on its platform and the amount has gone up in crores.

India’s largest e-commerce company, Flipkart, is going to drag them to court and is seeking to recover dues from nearly 20 Indian and foreign companies.

"There are about 20 Indian and foreign companies which haven't paid and the dues are in the range of Rs 90,000 to crores of rupees each," a person familiar with the development told ET.

Reportedly, Flipkart had recently registered such a case with the Delhi High Court against a US-based computer data storage company Western Digital and accused it of not paying over Rs 1 crore for placing ads on Flipkart.

Last year, Flipkart had offered other brands and sellers to advertise on its platform but there was no pre-paid mode of payment, thereby relying on companies to pay later on.

"The digital industry is suffering because there have been several cases where advertisers default on payment. We do not have a strong industry body in terms of payment collection yet. Payments for digital are cleared much after the payments of print and television," Amar Deep Singh, CEO, Interactive Avenues, told ET.

However, Amazon has a pre-paid mode for payments under which brands and sellers advertising on its platform need to make payment beforehand only.

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