Jyotsna JayaramPartner
Rachana Rautray Senior Associate
Sindhu A.Associate
Key Developments
-
Introduction of voluntary standards for platforms publishing online consumer reviews
In a move likely to increase the compliances and associated costs for platforms publishing consumer reviews, the Ministry of Consumer Affairs, Food and Public Distribution (Consumer Affairs Ministry) along with the Bureau of Indian Standards (BIS) has launched a new framework titled Indian Standard (IS) 19000:2022 ‘Online Consumer Reviews — Principles and Requirements for their Collection, Moderation and Publication’ (Consumer Review Standards). As per the press release, these standards are initially voluntary for compliance by all e-commerce platforms and may be made mandatory in the future if required.
The Consumer Review Standards require platforms to develop a written code of practice, which outlines how these standards and its guiding principles (such as accuracy, privacy, security, transparency, etc.) will be met and maintained. Further, platforms will need to develop a set of terms and conditions for consumers wishing to submit a review (that need to be complied with by the consumers when submitting their reviews). The Consumer Review Standards also impose specific conditions with respect to the features of review, treatment of solicited and unsolicited reviews, review modification, publication, flagging, removal, etc.
The implementation of these standards would mean doing away with the current hands-off approach of the platforms with respect to the content of the reviews. Additionally, incorporating these changes would mean re-looking at key aspects of their terms and platform design.
-
Consumers now have a right to have their products repaired rather than relying on original manufacturers
To reduce e-waste and provide consumers with greater access and choice to obtain repairs rather than solely rely on original manufacturers, the Consumer Affairs Ministry launched the ‘Right to Repair’ portal on 24 December 2022. The portal will provide product manuals obtained from manufacturers, which will allow consumers to repair the product independently, or with third-party assistance, rather than depending on original manufacturers. Consequently, product manufacturers may need to revisit their contracts and policies particularly in relation to warranty and repair claims as well as their annual maintenance contracts and facilitate access to spare parts of their products.
-
Reserve Bank of India commences pilots of digital currency for wholesale and retail sectors
On 1 November 2022, the Reserve Bank of India (RBI) commenced a pilot launch of central bank digital currency (CBDC), e₹-W for the wholesale sector. This pilot was followed up with the launch of e₹-R – a pilot of the digital currency in the retail space, on 1 December 2022.
The results from such pilots are likely to influence key design features of the digital rupee. The intention of introducing the CBDC appears to be to reduce costs incurred in cross-border remittances, inter-bank transfers and interchange fees.
Currently, the wholesale pilot is intended for settlement of secondary market transactions in government securities, interbank transfers and related wholesale transactions. The retail pilot is intended for retail transactions wherein the retail CBDC would potentially be made available to all users in the private sector, non-financial consumers and businesses. For this, RBI proposed allowing a closed user group of participating customers and merchants to transact in e₹-R through digital wallets offered by the participating banks, with both peer-to-peer and peer-to-merchant transactions being possible.
It will be interesting to see how this impacts e-commerce payment transactions with merchants.
-
Scope of payments under UPI and BBPS schemes to be expanded
In a significant move for customers and merchants alike, the RBI has decided to introduce a ‘single-block-and-multiple-debits functionality’ in Unified Payments Interface (UPI). The facility will enable customers to create a payment mandate against a merchant by blocking funds in their bank account for specific purposes which can be debited, whenever needed. This will allow merchants to get an assurance of timely payments and customers the ability to explore several ways to manage their payments to merchants.
Further, customers may soon be able to use Bharat Bill Payment System (BBPS) for several types of payments and collections. BBPS, an interoperable platform which currently only enables utility payments and does not enable non-recurring payments/collections among other types of payments, will now include all categories of payments and collections - recurring and non-recurring - thereby making the BBPS platform accessible to a wider set of individuals and businesses.
In this regard, separate guidelines and instructions by the National Payments Corporation of India to relevant authorities are awaited.
It will be interesting to witness the possibility of regulation of digital markets and its impact on business structures going forward, and how new-age technologies could inform business practices, such as consumer reviews. Notably for the fintech sector, the developments discussed above are likely to inform future design choices and the regulatory approach towards CBDCs in India as well as enable a variety of payment options through BBPS and UPI.
