Ecommerce giant Flipkart is looking to file case against over 20 companies to recover its dues from them for not paying for placing ads on its (Flipkart’s) website.
“There are about 20 Indian and foreign companies which haven’t paid and the dues are in the range of INR 90,000 to crores of rupees each,” said a person close to the development.
Media buyers follow a prepaid system for advertising on different websites, wherein brands are suppose to make payments in advance for the inventory that they purchase. In Flipkart’s case, they do not have a pre-payment system and hence they rely on getting payments later, which raises such non-payment issues.
On behalf of the digital industry, Internet and Mobile Association of India (IAMAI) is setting up a committee to help develop a payment mechanism system. Besides, the committee will also keep a check on payments and defaults with advertisers and digital networks on a regular basis.
Prior to this, last month, Flipkart had filed such case in the Delhi High Court against a US-based computer data storage company Western Digital for not paying more than INR 1 Cr. for placing ads on Flipkart’s website.
The development was first reported by ET.
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