Amazon Eliminates Commission Fees for Low-Cost Items in India Market Push

Amazon announced it will stop collecting commission fees from sellers in India on products under $11, expanding a policy that previously helped boost new seller registrations by 50%. The e-commerce giant is intensifying efforts to compete in India's crowded online marketplace against rivals like Walmart-backed Flipkart.

Amazon announced Monday it will eliminate commission charges for Indian sellers on items priced below 1,000 rupees (approximately $11), as the e-commerce giant works to draw more merchants to its platform and strengthen its position in India’s highly competitive online retail sector.

This decision builds upon Amazon’s ‘zero-referral fee’ initiative from last year, which applied to about 12 million items under 300 rupees and resulted in a 50% increase in new sellers signing up with Amazon India. These referral fees represent the commission payments sellers make to Amazon for each item sold through the platform.

Beginning March 16, the updated fee structure will apply to over 125 million products, according to Amazon, which also announced reductions in certain delivery costs.

“This move is designed to make selling on Amazon more lucrative and simpler, particularly for small businesses and entrepreneurs in tier-2 and tier-3 cities,” said Amit Nanda, director of Selling Partner Services for Amazon India.

India represents a vital marketplace for Amazon, driven by the country’s rapidly growing internet user population that has accelerated e-commerce expansion in the world’s most populous nation.

However, Amazon confronts intense rivalry in the region from Flipkart, which has Walmart’s backing, and the retail division of billionaire Mukesh Ambani’s Reliance Industries. Meanwhile, rapid-delivery services like Eternal’s Blinkit and Swiggy’s Instamart have been quickly capturing market share.

In December, Amazon announced plans to invest over $35 billion in India through 2030, aiming to enhance its artificial intelligence infrastructure while focusing on expanding retail logistics and supporting small business development.