November  2020 Monthly Newsletter Volume 1 Issue 2  
  Pre-Budget Memorandum
IAMAI has submitted its Pre-Budget Memorandum for 2021/22 to the Finance Ministry. The two main highlights of the submission are: suggested rethinking on Zero MDR and revising the rate of TDS on ecommerce platforms based on the feedback from payments and ecommerce industry respectively.

TDS in e-commerce (Section 194-O)
Budget 2020 introduced a new Section 194-O in the Income tax Act that mandates e-commerce platforms to deduct 1% TDS for all transactions facilitated over their platforms. Mandatory deduction without any income threshold means that for most small-scale sellers, the 1% TDS rate proposed under section 194-O will likely exceed their Income Tax liability. IAMAI has shared with the authorities an illustration that suggests for merchants who have a turnover of up to INR 1.25cr, the TDS under section 194-O would exceed the tax on income, resulting in an unnecessary refund position or in other words, create cash flow and working capital concerns for small businesses.Therefore, IAMAI has appealed to the Authorities to reduce the rate of TDS to 0.25% from 1%, which will help achieve the tax trail without creating the unintended cash-flow concerns.

Merchant Discount Rate (MDR) on UPI and RuPay Debit Card
IAMAI has proposed a much reduced and calibrated MDR model for UPI and Rupay Debit cards that balances the interests of both the small merchants and the providers of the payment services. It is suggested to delete Section 10A of the Payments and Settlements System Act, 2007 and amend Rules 119 AA of the income tax act to remove BHIM UPI, UPI QR and RuPay.

D2C Founders' Meet-up with Amit Agarwal, Chairman, IAMAI
On October 9, 2020 a group of more than 50 founders and co-founders of Direct to Consumer brands had an interaction with the IAMAI Chairman Amit Agarwal. The lead discussants were Aman Gupta and Manish Chowdhary, founders of boAt ( and Wow Skin ( respectively and also the chair and co-chair of IAMAI D2C Committee. Other participants were Nicobar (, The Moms Co. (, Vahdam Teas (, Bombay Shaving Company (, mCaffeine (, Teabox ( and many others.

Draft Advertisement Guidelines under the Consumer Protection (Amended) Act
A submission has been made by the association on the draft advertisement guidelines under the Consumer Protection (Amendment) Act. Members have raised the following issues of concern
  • Advertisements are presently governed by 24 different Acts, depending on the sector or business of the advertisement. Given the provisions of a new regulatory framework are at variance with pre-existing regulations, it risks over-regulation and unnecessarily compliance burdens for the industry.
  • The advertising industry has a stringent self-regulatory mechanism with the Advertising Standards Council of India (ASCI), that has been well recognised by the Highest Court. Therefore, any additional Rules is perhaps unwarranted.
  • The rules hinge on vague and subjective terms like “generally accepted standards of public decency” or “acceptable standard” which need to be legally defined for enforceability.
  • The Guidelines seek to regulate various forms of advertising, including “bait advertising”; “surrogate advertising” and “comparative advertising”. However, these terms have not been defined in the Guidelines, thereby leading to ambiguity regarding the content to which the prescribed obligations are applicable.

India AI Stack framework proposed by the Department of Telecommunications
The vision document suggests a centrally controlled AI database where all AI based service providers in India will have to replicate their data mandatorily. Members have the following suggestions on the framework. Instead, IAMAI has suggested that the AI stack is built on a technical infrastructure that is interoperable and based on open standards. Interoperability has several important benefits. By abstracting away the underlying infrastructure, it commodifies it and intensifies competition among infrastructure providers. This discourages rent-seeking behavior from such providers and instead encourages them to compete based on the quality and cost of their services. Interoperability also enables innovation and incentivizes businesses to modernize.

Launch of First Virtual Incubation Cohort
IAMAI-Mobile10X, through its Virtual Incubation program makes startup incubation programs accessible to every startup in the country through a one year sector agnostic incubation support program with services like online mentoring, startup investment connect, technology consulting etc., and IAMAI Cares kit including startup credits up to $160,000. For the first cohort 12 startups have already joined the IAMAI Virtual Incubation Centre and startup-centric activities and connect programmes are underway to provide required support to startups.
  India Affiliate Summit
India Affiliate Summit  was held on October 7 and 8, 2020 on India and Beyond theme, there were 2000+ attendees from over 40 countries and 60+ speakers. There were over 25 exhibitors too displaying their products. Key Speakers included Anita Nayyar, Head-Customer Strategy & Relationships, Zee5, Ayushman Chiranewala, Head – Marketing, Fastrack, Kaushik Mukherjee, Co-Founder & COO, SUGAR Cosmetics, Kuntal Banerjee, Head - Digital Marketing, Maruti India, Manmeet Singh, Affiliate Lead, APAC, NortonLifeLock, Parul Bhargava, Chief Executive Officer, vCommission. Prajakta Koli, Indian Youtuber, Stephan Spencer, Co-Author, The Art of SEO, Victoria Galperina, Head of Affiliate Marketing, Supermetrics

Roundtable on e-Pharmacy
Leading industry representatives urged the government to finalize the draft e-pharmacy rules and notify them immediately. In the current form, the draft guidelines do not recognise “platforms or marketplaces” that enable sellers to sell drugs online. The regulatory uncertainty puts a cloud over existing players who operate with this business model currently, and completely discourage new investment in that space. Unless the guidelines clearly recognize marketplace platforms, there remains ambiguity on the legality of marketplaces, and it discourages investment and adversely impacts the sector’s growth.
This was one of the main concerns raised by panelists in a virtual discussion titled “ePharmacy: Digitally Empowering Consumers & Small Businesses” on 14 October 2020, was organised by IAMAI.
The discussion had representatives from civil society, law firms and industry to explore the various facets of the issue related to the importance of e-pharmacy especially considering the National Digital Health Mission. Panelists included Tanmay Saksena, Chief Operating Officer, 1mg; Ravi Kant Sharma, Founder & CEO,; Prof. Bejon Misra, Founder Director, Patients Safety and Access; and Krishna Sarma, Managing Partner, Corporate Law Group. 

Design Leadership Summit
IAMAI has recently concluded its first ever ‘Design Leadership Summit 2020’, on 29-30 Oct 2020 which was inaugurated by Dr. Yasmin Ali Haque, UNICEF representative India, and while delivering the inaugural address, she emphasized on need of Design Thinking at the core of any process and development and imp. She also shared her global experiences at UNICEF, where slight design positive attention had brought huge differences and impacted positively to the societies. The theme for this year’s summit was “Resurgence: Designing for Now, Next and Future”.

The summit was held under the guidance of IAMAI’s Design and Innovation Committee IAMAI Design & Innovation Committee, which is Chaired by Apala Lahiri, Co-founder, HFI APAC and Dr. Girish Prabhu, Founder, ifDE is the Co-chair of the committee. The summit concluded with the announcement of Design Leadership Awards 2020, which were given to the design focused products and solutions in three categories:, i.e. (1) Social Impact and Bottom-Up Design, (2) Tech Design and (3) Industry and Innovative Design, a total of 10 winners were awarded at the award session of the summit. The two-day virtual summit was attended by 1000+ participants and was addressed by 80+ global and India experts from the design domain.