When things came to a halt and customers stepped in to cancel all their reservations, several startups were left with a ton of refund requests, but no cash flow to make up for it. We bring the latest edition of ‘Year in review‘to guide you through the customer-related crisis startups had to face in 2020.
As the pandemic hit India hard, consumers too had to adjust to a new reality and all plans came to a halt with the shutdown. Cancellation of flights, hotel reservations and car rentals – many companies suddenly found themselves under a mountain of overwhelming amounts of reimbursement requests with almost zero cash flow.
The startups operating in the segment had two options to choose from: delete all invoices and reduce the track, or retain all invoices and expand the track.
While one way made the company guarantee its survival, the other maintained the goodwill of the company while risking the entire setup. The choice was not so simple, especially amid the decline among customers eagerly awaiting their installments. Some companies handled the crisis well, for others it just got out of hand.
It’s important to note that the Covid-induced crisis wasn’t the only reason for customer complaints against businesses this year, but it was definitely a cause for concern for many of the startups. We also saw companies getting into hot water with their stance on political issues, as well as some complaints about educational technology products making headlines this year.
Zoom – Customers demand refunds on social media, the company keeps quiet
Three months after the closure, several Zoomcar passengers took to social media platforms such as Twitter and LinkedIn to discuss their complaint against the company. It had been more than 15, 30, and in some cases 60 days since the company had not issued refunds for canceled reservations.
To make matters worse, there were no concrete responses from the company. “We agree with your distress regarding the delay in obtaining a refund. Rest assured that our team has been working on this, we will make sure the refund is processed as soon as possible. In the meantime, we are requesting your patience, ”the company’s Twitter user would reply to all tweets with the keywords“ Zoomcar ”and“ refunds ”.
Some clients even took matters into their own hands and reached out to founder and CEO Greg Moran, but there was no response from that side, either. All his complaints fell on deaf ears. In response to Inc42In response to inquiries, Moran said he was not aware of any such problem or the allegations made against the company. Despite the fact that social networks were full of anger from customers.
But there is no denying that the company was going through a difficult time and that its main offering was halted with no signs of recovery. According to company sources, Zoomcar decided to keep its employees on board and delay reimbursements for now.
Read our report in depth here.
NestAway – As the tenants leave the nest, where are the refunds?
“I decided to vacate the house this June after the closing was lifted. After I submitted a request to vacate the application, I mentioned that they would return my INR 25,000 deposit refunds with no deductions within 7 days, but all this information was removed from the dashboard the day after I moved and I am still receiving money ”Siddhant Garg, a Bengaluru-based software engineer, He said the Mint in early July.
This is just one of the many claims that NestAway was surrounded in July 2020. The closure and travel restrictions were recently lifted, work from home was instituted for at least a couple more months. There were no signs of a return to normalcy, so the migrated workforce did the logical thing to do: vacate their rented properties.
This increase in reverse migration has affected almost all startups operating in the rental space, but things got out of hand for NestAway. Several clients went to consumer court alleging fraud and extortion against the company due to failure to pay their refundable security deposits. Some also took to social media to highlight their complaints and organized on apps like Telegram.
In June, the NestAway spokesperson said the startups have witnessed an increase in moving cases in the past 2-3 months and have settled claims of about 3,000 cases.
MakeMyTrip, Yatra.com, EasyMyTrip – Online travel agencies must pay for canceled flights
As all travel plans came to a halt with national and global lockdowns, online travel agencies (OTAs) such as MakeMyTrip, Yatra.com, and EaseMyTrip found themselves in the middle of refunds even though they were only a facilitator of bookings from travel and not the vendors themselves. . The platforms were the first to face pent-up anger from customers when airlines delayed payments.
But what could the airlines do? They too echoed multi-million dollar payments when the world came to a standstill. According to media reports, additional tickets worth INR 180 Cr were booked in the first 9 days of lockdown, between March 25 and May 3, on all private airlines. Indigo contributed to almost 50% of the inputs worth INR 90 to 95 Cr.
Read our full report here
Digital loan applications – Easy loans turn into a nightmare
The Indian government has been aggressively pushing for financial inclusion, creating a broader reach for new age digital lenders known for their easy and streamlined loan approval process. Even before the segment could fully take off, it has witnessed some troublesome issues that need to be urgently addressed.
At least five people are known to have committed suicide in recent months, allegedly due to the harsh loan recovery methods employed by these digital loan platforms. One victim of this alleged harassment was Abhishek Makwana, writer of the popular Hindi comedy ‘Taarak Mehta Ka Ooltah Chashma’, who died by suicide on November 27.
Regardless of the size of the loan, the history of harassment remains the same. It starts with kind reminders, but it turns into harassment, abuse from customers and even from family members. Few clients Inc42 + He spoke of naming the application Red Carpet, among others, for having carried out such tactics.
In one of the incidents, the Red Carpet app sent threatening and abusive messages to a customer’s fiancée and her father, resulting in a broken marriage before it could even happen.
Read the full Inc42 + report here.
WhiteHat Jr – From ads to products, a series of problems for Edtech Giant
WhiteHat Jr is easily the most talked about startup in India right now. Founded just two years ago, WhiteHat Jr has already achieved a $ 150Mn execution rate, a 4.2Mn subscriber base of users worldwide, and an acquisition of BYJU’S, the world’s most valued educational technology startup. However, the year has also been full of controversy for this educational technology startup.
Of the company advertising strategies and aggressive removal of the critics has been one of the most controversial aspects, without a doubt. People can argue that these issues were raised primarily by non-customers and critics on social media, who never attended their paid sessions. But the controversies have definitely impacted the company’s users as well.
Internal communications from WhiteHat Jr’s Online Reputation Management (ORM) team were made public, thanks to software engineer Pradeep Poonia. These chats highlighted how coding for kids’ startups would suppress the voice of their customers giving genuine reviews about the product.
One of the clients also contacted the CEO of the company, Karan Bajaj, to highlight their complaints, however, instead of resolving it, four free classes were offered to the client.
Zomato, Swiggy – Political talk goes bad for the delivery giants
‘To be or not to be politically correct ‘ It’s a dilemma many companies face, but few have the stomach to do it. At a time when talking about political opinion leads to boycott campaigns, negative reviews, and a lot of trolling, food aggregation companies Zomato and Swiggy decided to upset the trolls with their satirical tweets and direct approach.
For Zomato, it actually started last year, when a customer complained to Zomato about how he didn’t want to be served by a Muslim delivery executive. The food delivery business decided not to let it slip under the rug and responded “food is not a religion, it is a religion.”
Since then, Zomato hasn’t been one of the right-wingers’ favorite brands. The company led by Deepinder Goyal has left no opportunity to make its views on fairness very clear and denounce bigotry. The company even made sure that they will analyze their advertising strategies when asked about ads running on Republic TV. So this leads to another #BoycottZomato trend on Twitter.
Accustomed to Zomato’s ‘liberal’ stance, customers were soon shocked by Swiggy’s smug statement that won the hearts of many. A satirical tweet from Finance Minister Nirmala Sitharaman’s parody account read: “I had a discussion with my friend Bhakt about a farmers’ protest. He said that we do not depend on farmers for food. We can always order food from Swiggy. He won. “Soon, the company jumped on the scene with its statement of” Sorry, we do not reimburse for education. “