Amazon India announced a massive expansion of its zero-referral fee (commission) policy, effectively waiving its cut on over 12.5 crore products priced under ₹1,000.
The move, which takes effect on March 16, 2026, is a direct response to intensifying competition from zero-commission platforms like Meesho and rival Flipkart, which introduced a similar sub-₹1,000 waiver in late 2025.
Key Highlights of the New Fee Structure
This update represents a 10x expansion over Amazon’s previous April 2025 policy, which only covered items under ₹300.
| Metric | New Policy (Effective March 16, 2026) | Previous Policy (April 2025) |
| Price Threshold | Under ₹1,000 | Under ₹300 |
| Product Coverage | 12.5 Crore+ items | 1.2 Crore items |
| Categories Covered | 1,800+ categories | 135 categories |
| Shipping Fees | 20% reduction in Easy Ship fees for sub-₹300 items | Standard rates |
- Total Savings: Amazon estimate that this shift will allow sellers to save up to 70% in total fees, providing significant breathing room for small businesses and entrepreneurs.
- Flywheel Impact: By removing commissions, Amazon expects sellers to pass on the savings to consumers, driving higher volumes in the high-frequency “everyday consumption” segment.
Why Amazon is Cutting Fees
The “fee war” in Indian e-commerce has reached a tipping point as horizontal giants fight to protect their territory from specialized upstarts:
- The “Meesho” Factor: Value-commerce platform Meesho pioneered the zero-commission model, attracting millions of small sellers. Amazon is now adopting this strategy to win back Tier-2 and Tier-3 merchants.
- Quick Commerce Pressure: Rapid-delivery apps like Blinkit and Zepto are rapidly capturing market share in low-value, high-frequency categories (like toys and stationery). Amazon’s fee cut is an attempt to keep its marketplace “economically viable” for these small items.
- Seller Growth: Following the original sub-₹300 waiver last year, Amazon saw a 50% surge in new seller registrations. They are doubling down on this trend to further expand their catalog.
Additional Seller Incentives
Beyond the commission waiver, Amazon introduced several “stackable” benefits for 2026:
- Multi-Unit Discounts: Sellers shipping multiple units in a single box can save over 90% on selling fees for the second unit onward.
- AI Tooling: Amazon is rolling out AI-powered tools to 15 million enterprises by 2030, offering automated listing creation and advanced customer analytics to simplify the selling process.
- Marketplace Fee: Note that while commissions are gone for these items, a flat ₹5 marketplace fee (paid by the customer at checkout) was introduced in June 2025 to help cover platform operational costs.
Market Context
This announcement comes as Amazon reports a significantly improved financial health in India, having narrowed its net losses by 89% in the last fiscal year. By sacrificing short-term commission revenue, the company is prioritizing volume and ecosystem loyalty in the world’s most populous market.
