The National Restaurant Association of India (NRAI) has issued an advisory to its members regarding the potential long-term adverse effects of large-scale in-dining discount programmes and aggregator payment platforms.
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The National Restaurant Association of India (NRAI) has issued an advisory to its members regarding the potential long-term adverse effects of large-scale in-dining discount programmes and aggregator payment platforms. These programmes, while appearing beneficial in the short term, could threaten the economic stability and autonomy of restaurants and disrupt the restaurant ecosystem.
In the recent past, deep discounting has caused significant challenges in the food delivery market, and the NRAI warns that similar tactics are being employed to capture the dine-in market through aggressive aggregator payment gateway adoption.
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The NRAI emphasizes that deep discounting presents substantial economic hurdles to the restaurant business. Unlimited and unsustainable discounts alter price structures, setting unreasonable expectations for customers and undervaluing the dining experience.
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Aggregator payment gateways provide various issues for eateries. These networks reward clients with aggressive discounts and cashback, which are sometimes sponsored at the expense of the restaurants themselves. However, restaurants must pay substantial commissions on transactions, ranging from 4-8 per cent, significantly higher than the 1-1.5 per cent charged by standard payment gateways.
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