Amazon Zeroed Referral Fees Under ₹300 — So Did Your Edge

What Amazon actually changed, and when

On 7 April 2025, Amazon India removed referral fees entirely on roughly 1.2 crore products priced under ₹300, spanning apparel, footwear, fashion jewellery, home décor, beauty, kitchen and pet categories — 135+ categories in total. Amazon called it the largest seller-fee reduction in its India history. Alongside the referral-fee waiver, it also cut Easy Ship and Seller Flex base shipping from ₹77 to ₹65, and trimmed weight-handling charges on sub-1kg parcels by up to ₹17.

This wasn’t a one-time promo. Amazon kept moving the line. From November 2025 it temporarily extended zero referral fees to items under ₹1,000, then made that permanent from 16 March 2026, covering 12.5 crore products across 1,800+ categories — a tenfold jump in eligible catalogue size from the original policy. Flipkart didn’t sit still either: it matched with zero commission on all products under ₹1,000 from November 2025, cutting cost-of-selling roughly 30% for that band, then went further and removed the price cap entirely for fashion from July 2026.

Why this happened is not a mystery. Referral fees of 5–19% plus a flat ₹77 shipping floor made a ₹250 kurti or a ₹280 phone case structurally unprofitable to list for a small seller — a ₹40 referral fee alone could wipe out the entire margin. Amazon and Flipkart are both fighting for the ₹100–₹999 “value commerce” tier that Meesho and Shopsy have been winning almost by default. Removing the fee didn’t just lower a cost line. It made an entire tier of Bharat-market products viable to list for the first time, which is why registrations moved and not just revenue on existing listings.

The number that’s real, and the number that isn’t

Trade press, led by Inc42, reports that new seller registrations on Amazon.in rose close to 50% year-on-year after the fee waiver — the figure this article is built around. It’s a credible, widely-cited number, but it’s worth being precise about what it measures: it’s the rate of new sign-ups, not the size of the total seller base.

Amazon’s own material states the active seller base stood at 1.6 million sellers at the time of the April 2025 announcement, with over 90% SMBs and over 50% based in Tier 2/3/4 cities. Eleven months later, that base had grown to roughly 1.7 million sellers — about 6% growth in the total stock of active sellers over that period. That’s a very different number from “50%.” Both are true at once: new registrations accelerated sharply (the flow), while the total active base grew far more modestly (the stock), because plenty of new sign-ups are small, part-time, or slow to become active sellers. If you’re deciding how crowded your category is about to get, the 50% figure is the one that matters — that’s the rate at which fresh competition is entering right now.

What the fee cut is actually worth, in rupees

Source: Amazon’s own published examples in the March 2026 announcement. Notice the pattern — percentage savings are largest on the higher-value items inside the sub-₹1,000 band, not uniform across the board. A flat-rate assumption (“everything’s now 50–70% cheaper to sell”) will misprice your margin.

Two things this table does not mean. First, the waiver is price-band and category gated — it is not “Amazon is now free.” Closing fees, FBA storage, weight-handling on heavier parcels, and advertising cost (ACOS) still apply — the waiver removes one line item, not the whole cost stack. Second, if most of what you sell sits above ₹1,000, you weren’t left out entirely: Amazon separately cut standard referral fees by 4–9.5 percentage points in high-demand categories like apparel and fashion jewellery even above the zero-fee threshold — smaller, but real.

What it costs you if you just take the margin and do nothing

Here’s the part the fee announcement doesn’t say out loud: cheaper to list is not the same as easier to win. If close to 50% more sellers are registering into the exact price bands Amazon just made viable, and a meaningful share of them are listing the same ₹280 phone case or ₹249 kurti sourced from the same wholesale suppliers, then the fee advantage you just gained is also available to every seller who shows up after you. Within a quarter, the cost side of the equation flattens out across the category — everyone’s paying the same lower fee — and the only variable left that decides who gets the click and who gets scrolled past is the listing itself.

Run the numbers on a Tier-3 seller who registers this month to list sub-₹300 phone cases. If the category already has 10,000 sellers listing near-identical SKUs with the same stock supplier images, click-through and conversion increasingly hinge on which hero image and infographic actually differentiate. A pure fee advantage, once matched by competitors, is worth zero within one quarter. The advantage that survives is the one competitors can’t copy by registering an Amazon Seller Central account — a shot, an angle, a brand story that’s actually yours.

Not every seller in this story is standing in the same spot on the timeline. Where you land — and what to do about it — depends on which price band you actually sell in.

The takeaway that isn’t just “wait and see”

The fee cut is real, it’s dated, and it’s still expanding — treat it as structural, not promotional. But the 50% registration surge means the advantage of lower fees has a shelf life measured in one to two quarters before your category looks like everyone else’s category. The sellers who come out ahead a year from now won’t be the ones who listed cheapest fastest.

If you’re not sure whether your current listings can survive that comparison, start with a single listing teardown on your best-selling SKU — it tells you in one page whether your fee savings are funding an advantage or just padding a margin someone else is about to erode.