With Swiggy’s IPO on the horizon, restaurants cry foul over a lack of transparency

In early June, Vidyarthi Bhavan, a famous Bengaluru-based restaurant, wrote a letter to a local hotel association, Bruhat Bengaluru Hotels Association (BBHA), detailing issues it had with foodtech giant Swiggy. The letter, leaked to several media houses, including The CapTable, accused Swiggy of hidden charges, higher commissions than its rival Zomato, and forcing restaurants to participate in discount programmes without their explicit consent.

The BBHA, while not associated with the pan-India restaurant industry body NRAI, counts some of Bengaluru’s oldest and most iconic restaurants, including Empire Hotel, as members. When The CapTable reached out to PC Rao, president of BBHA, he expressed surprise that the letter was leaked. “We are currently collating inputs from all restaurants and will be sending a detailed letter to Swiggy,” he said.

Interestingly, the letter didn’t take equal issue with Swiggy’s arch-rival, Zomato. In fact, it praised the Gurugram-based company for charging lower commissions and being more transparent with the various charges it levies on restaurants.