Others on the quick commerce track are also in the news. Zomato (now Eternal), founded in 2008 by Deepinder Goyal and Pankaj Chaddah as FoodieBay originally, got noticed for its Q1 FY27 financial results recently, especially for its quick commerce platform Blinkit. The numbers showed not just a substantial rise in Blinkit’s monthly users but also a higher transaction frequency. Swiggy, which was founded in 2014 by Sriharsha Majety, Rahul Jaimini and Nandan Reddy, and its quick commerce unit Instamart are out there too for their financial numbers.
Leadership changes in the quick commerce space have also been a talking point. Nandita Sinha moved from Myntra to join as Instamart CEO, as Amitesh Kumar Jha quit as the chief executive of Instamart. Not too long ago, Amit Nanda took over as the CEO of BigBasket, replacing co-founder and chief executive Hari Menon. BigBasket, which was founded in 2011 by five entrepreneurs and is now majority-owned by Tata Digital, is betting big on quick commerce to revive the business.
Mr Nanda made the switch from Amazon, which too sees quick commerce as a potential winner and is investing heavily in that category. Walmart-owned Flipkart, also on a spree to reach its consumers faster than ever before, is competing with Amazon as well as the pure-play quick commerce players. Flipkart is also starting food delivery sometime this month, adding another layer to the quick commerce game.
This growing buzz around quick commerce has a lot to do with the seamless payment mechanism in India. The UPI (Unified Payments Interface), undoubtedly, has played an important role in perfecting the quick commerce game for startups as well as traditional businesses venturing into an area that is all about fast, faster, fastest. Will that change with the government tabling a Bill in Parliament that may once again usher in the era of MDR (merchant discount rate) — a fee paid by merchants to banks and payment service providers?
In 2020, the MDR on UPI use was removed to drive digital payments and for ease of doing business. While the latest proposal seeks to amend Section 10A of the Payment and Settlement Systems Act, 2007, which protected UPI and RuPay debit cards from MDR being imposed on them, no fee has been suggested yet. The amendment will allow the government to notify which electronic payment modes could attract MDR. If and when a levy is imposed, analysts believe small transactions as well as those between two individuals would be spared. As reported, the thinking within the government seems to be that an MDR of below 0.5 per cent may be imposed for transactions of above ₹2,000 with businesses and merchants. The range of the levy may be tiered. Also, the turnover of a business/merchant may kick in while calculating the MDR — it is possible that those with an annual turnover of up to ₹1.5 crore may not have to make this payment.
So many caveats, categories and tiered calculations while imposing an MDR on UPI transactions could result in a labyrinth of rules and guidelines in an already complex retail landscape, including in fast-growing ecommerce and quick commerce. It may turn out to be quite a task to determine the levy based on the turnover of a merchant in addition to each transaction value. Thousands of sellers and merchants of various sizes are hosted on ecommerce marketplace platforms. While there’s no clarity yet on how much or whether a buyer will need to pay at all once MDR kicks in, typically merchants and businesses are known to pass on any additional burden to the consumer.
Whether or not quick commerce is an ideal business format is another matter. A few months ago, gig workers went on strike, protesting against the quick commerce model and citing safety hazards in meeting such short-duration deadlines. After government intervention, many companies removed the 10-minute-delivery marketing and advertising tags. However, quick commerce — whatever definition one may adopt — continues as a vibrant stream of business, with warehouses and dark stores coming up all over the country.
In a recent conversation, Flipkart CEO Kalyan Krishnamurthy told this newspaper that Flipkart is not a quick commerce company and that quick commerce is only one of the ways to deliver products. Even so, it is clear that no online business can escape the urgency of speed in the current order. Mr Krishnamurthy’s answer to a question about artificial intelligence is self-explanatory: “Whoever uses AI and technology to get products to customers first will win. That’s the North Star for technology and AI.”
Indeed, UPI, which is subsidised by the government through an incentive scheme for transactions up to ₹2,000 at small merchants, is looking for a sustainable financial model for the investment required to scale up its technology and reach. But is bringing back MDR (like in the case of credit and debit cards), and that too with a complex rulebook, the only way forward?
 "Qcom, quick commerce")