Google defers Play Store's 30% commission on IAPs until April 2022 in India

Google updated its payment policy for the Google Play Store last week to make it mandatory for developers to use Play's own billing system for IAPs and pay Google a 30% fee on sales. While this rule was there from before as well, Google never strictly enforced it, which is what changed last week. This led to quite a bit of uproar in India where over 50 startups and companies expressed their unhappiness with the 30% fee. This even led to rumors of the Indian government working on its own local app store alternative.

Following the backlash though, Google has now decided to defer the 30% commission on IAPs and sale of digital goods from the Play Store in India until at least April 2022. For the rest of the world though, the changes will come into effect from September 2021. By giving Indian app developers such a long period of time before the transition, Google wants to make sure that it does not put them under any undue stress. The time can also be utilized by all the parties involved talking to each other to find a solution to the problem.

Sameer Samat, VP of product management at Google said the company is "not discussing a change in the model per se but I do feel that we can engage and hear discussion on billing but also other topics they would like to discuss. We can find ways to grow together."

The executive justifies Google's commission on the sale of digital goods through the Play Store with the number of services it provides to customers if something goes wrong or if an app does not work properly. This is also the reason why the commission is only applicable to the sale of digital goods and not physical goods. Google will also set up listening sessions with Indian startups to understand and alleviate their concerns about this policy change and how they can work together to resolve the issues.

Samat noted that the policy only affects around 3% of the global developers on Google Play, with around 98% of them already using the Play Store's billing system. However, since the company received a lot of questions from developers from across the globe, it has issued more clarification on this move.

Source: Economic Times