The National Restaurant Association of India (NRAI) has raised concerns about the long-term implications of in-dining deep discount programs and mandatory aggregator payment platforms, warning that they threaten the financial sustainability and independence of restaurants. While these programs may appear attractive for boosting short-term footfall, their long-term effects include eroded profit margins, disrupted pricing structures, and diminished brand value.

Small and independent restaurants are particularly vulnerable. Unlike larger chains with substantial financial backing, smaller establishments struggle to sustain operations when offering aggressive discounts. These practices risk creating an environment where customers expect unsustainable deals, undervaluing the quality of the dining experience.

Additionally, the bundling of deep discount schemes with aggregator payment platforms exacerbates the issue. Restaurants are compelled to pay commissions as high as 4–8% per transaction, far exceeding the standard 1–1.5% charged by conventional payment gateways. This adds to the financial strain while giving aggregators increased control over customer relationships.

As customers gravitate toward aggregator-driven ecosystems, restaurants face the risk of losing direct engagement with their patrons. This compromises their autonomy and hinders the development of loyal, long-term customer bases.

The NRAI urges restaurants to critically assess such programs and adopt sustainable practices that prioritize quality and independence. Deep discounting may seem like a competitive necessity, but its hidden costs make it a double-edged sword. Restaurants must instead focus on creating unique dining experiences and fostering direct customer relationships to ensure their long-term success.

Insights for this article are inspired by the National Restaurant Association of India.