Indian Watchdog Investigating Google’s Fees For In-App Payments

An Indian regulator has reportedly begun an antitrust investigation into Google.

The inquiry by the Competition Commission of India (CCI) centers on a service fee Google charges for payments made in apps, Reuters reported Friday (May 12), citing a document it has seen that has not been made public.

The CCI’s probe of Google’s User Choice Billing system follows complaints by some companies that the fee violates an earlier antitrust directive, according to the report.

The directive issued by CCI in October 2022 said Google must allow developers to use third-party billing rather than requiring them to use its in-app payment system and pay a commission of 15% to 30%, the report said.

Google began offering User Choice Billing, which allows alternative payments, in addition to its in-app payment system. However, companies note that UCB charges a service fee of 11% to 26%, per the report.

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The CCI’s inquiry asks Google about the in-app payment system, User Choice Billing and its policies around sharing data and requires the company to respond in four weeks, according to the report.

Reached for comment by PYMNTS, a Google spokesperson said that the company is committed to complying with local laws and regulations; that it has implemented changes and is in compliance with the CCI’s directions; and that it looks forward to engaging constructively with the CCI.

The tech giant has said in the past that the fee enables it to invest in its app store and mobile operating system, distribute the operating system at no charge and provides tools and services to developers, the report said.

Google extended the availability of User Choice Billing to India and several other countries in September, enabling third-party payment options for developers in the Google Play Store and saying developers will see the typical 15% to 30% service fee charged by Google drop by 4% when they opt to use a third-party billing option.

“Android has always been a uniquely open operating system and we continue to evolve our platform and increase the choices available to developers and users while maintaining our ability to invest in the ecosystem,” a Google spokesperson said at the time.

User Choice Billing made its debut six months earlier, in March 2022, when Google and Spotify announced a new agreement allowing users to download Spotify from the Google Play store and choose to pay with either Spotify’s payment system or Google Play Billing.