Reliance Industries' online fashion store, Ajio, is planning to create a new marketplace for low-priced fashion products called Ajio Street. The platform will use a zero-commission model, which means merchants don't have to pay anything to sell their products on it. Ajio is hoping to attract merchants to the platform by offering 15-day payment settlements.
This move will put Ajio in direct competition with SoftBank and Fidelity-backed platform Meesho, which specialises in selling low-cost fashion and accessories. Ajio Street will mainly offer value products aimed at consumers in smaller cities and towns.
The new zero-commission model is expected to bring in new users from these markets who may not shop online frequently. Ajio has already generated $2 billion in gross merchandise value and is the second-largest fashion and lifestyle category platform, behind Myntra. However, it is still unclear how Ajio plans to make money from this new venture.