The Service Charge Conundrum
A nationwide survey encompassing over 39,000 responses from consumers across 288 districts has brought to light a persistent issue in the Indian dining
landscape. Despite the Central Consumer Protection Authority (CCPA) explicitly deeming the levy of service charge by restaurants as an unfair trade practice, a striking 59% of individuals who dined at air-conditioned establishments in the preceding month reported paying this charge. This observation is particularly noteworthy as it represents a considerable uptick from previous years, indicating that official interventions have yet to fully curb the practice. The survey, designed to assess the impact of governmental and judicial pronouncements on the imposition of service charges, collected data from a diverse demographic, with 63% male and 37% female respondents. Furthermore, geographical distribution revealed representation from all tiers of districts, with 45% from tier 1, 29% from tier 2, and 26% from tier 3 and 4 areas, suggesting a broad scope of the findings.
Escalating Payment Trend
The recent survey results paint a clear picture of an increasing trend in consumers paying service charges at air-conditioned restaurants. The data indicates that the percentage of diners who paid this charge rose from 43% in 2022 to a significant 59% in the latest survey period. This surge suggests that restaurateurs are either continuing to apply the charge despite awareness of its classification as unfair, or consumers are increasingly resigned to paying it. When questioned about their specific experience, a substantial 59% of the 19,455 respondents who visited an AC restaurant in the last month confirmed that the charge was applied and they proceeded to pay it. While a portion of respondents, 16%, managed to have the charge removed, and 18% noted that it wasn't levied at all, the majority outcome points to a widespread acceptance or acquiescence to the practice, raising questions about the effectiveness of current regulatory measures.
Consumer Call for Action
In light of the persistent imposition of service charges, the survey also probed consumer perspectives on how regulatory bodies should address the issue moving forward. A significant 54% of the 20,276 respondents expressed a strong belief that the CCPA should take a more proactive role by establishing enforceable guidelines for restaurant service charges. They advocate for these guidelines to be enforced through state legal metrology departments. This segment of consumers feels that voluntary compliance or mere advisories are insufficient to tackle the ingrained practice. Conversely, a notable 39% of respondents voiced a preference for minimal government intervention, believing that the CCPA should not enforce any specific guidelines and that such private transactions should remain unregulated. This divergence in opinion highlights the ongoing debate about the balance between consumer protection and freedom of private enterprise, with a clear majority leaning towards stronger regulatory action.
