UPSC 2022 countdown has begun! Get your personal guidance plan now! (Click here)

Context

Every year, 24th of December is observed as National Consumer Day.
On this day, the Consumer Protection Act, 1986 had received the assent of the president.
The enactment of this Act is considered as a historic milestone in the consumer movement in the country.

This day presents an opportunity to highlight the importance of the consumer movement, the need to make people aware of their rights as consumers, and to ensure consumers with effective safeguards against different types of exploitation such as defective goods, deficiency in services and unfair trade practices.

In this age of e-commerce, which facilitated creation of new approaches to service and product delivery, the challenges of ensuring customer protection have grown manifold. It has raised multiple questions:

How are the interests of e-commerce consumers being protected?
How free and fair competition in e-com market is being encouraged?
How redressal mechanisms for consumer grievances are being strengthened?

E-Commerce boom since Pandemic

The significance of e-commerce has gained attention especially at time of pandemic where the entire value chain and flow of goods and services were dependent on e-commerce.
It was discussed that the emergence of the e-commerce market has created several avenues for online frauds, counterfeit products that affect consumer safety.

Various threats to consumers on E-Com platforms

[A] INFORMATION

Sharing unwanted program- Adware
Spyware
Browser parasites
Cyber-stalking
Risks to behavioural data

[B] ORDERING OF PRODUCTS

Risk of misuse of behavioural pattern data
Malicious recommender algorithm

[C] PAYMENT

Phishing (Threat to login credentials and credit card numbers)
Pharming attacks (fake websites)
Salami attacks (very small amounts of money from thousands of bank accounts is manipulated at once)
Risks to transaction data

[D] DELIVERY

Breach of contract. Ex. Product quality, delivery time etc.

[E] SUPPORT

Processing of cancellation
Refund
Service related issues

Rationale for Consumer Protection in E-commerce

All consumers need to have access to e-commerce.
To build consumer trust/confidence in e-commerce, the continued development of transparent and effective consumer protection mechanisms is required to check fraudulent, misleading, and unfair practices online.
All stakeholders-government, businesses, consumers, and their representatives- must pay close attention to creating effective redress systems.

E-Commerce Rules

Framed under Consumer Protection Act, 2019, it regulates goods and services sold over digital or e-networks.
It lays down duties, liabilities for all e-commerce entities.
Rules don’t apply to activities taken in personal capacity. It applies to entities not set up in India, but offering business here.
Fair pricing: No e-commerce entity should manipulate the price of goods/services offered
Authentic information: No fake customer reviews, advertisements inconsistent with actual features, access or usage of goods
Seller information: It must provide details about the sellers including registration status
Dedicated grievance redressal mechanism: Every e-com company must establish mechanism for grievance redressal
Compliance officer: The firm has to appoint a person to ensure compliance with this Act
Headquarters: Platform should provide legal name, address of headquarters and its branches
Timely resolution of complaints: Grievance officer to acknowledge receipt of complaint within 48 hrs and must resolve the complaint within a month
Refunds in compliance with RBI: Every entity shall affect all refund payment requests as per rules laid by the RBI

Also read

Explained: Consumer Protection Act, 2019

Various Rights of Customer

Right to safety
Right to be informed
Right to choose
Right to be heard
Right to seek redressal
Right to consumer education

Where to file complaint?

National Consumer Helpline (NCH) App / Website
UMANG App
Toll free number 14404

Way forward

With the changing technology and trending trade policies it is recommended that there needs to be effective interventions by the government to implement the consumer outreach programmes.
There is an essential role played by social media in spreading awareness among consumers which can be further promoted and added on to the exemplary campaign like “ Jago Grahak Jago”.
Special and effective awareness campaigns must be brought into the rural areas.
Data privacy and data security of the consumers must be ensured to prevent cybercrime threats.