New Delhi, Sept. 4 -- Swiggy's recent decision to raise its platform fee to Rs.15 per order marking the third increase in just three weeks is more than a matter of margins. It brings into focus how the consumer prices in the Indian food delivery industry are being subtly transformed through algorithm-driven pricing mechanisms. Platform fees are not as transparent as delivery charges, which are dependent on distance, or restaurant commissions, and this is a unique feature of the food delivery cost structure.

Both the Swiggy and its competitor Zomato have embarked on charging more during peak times. These platforms experiment with real-time demand models to determine whether users will keep ordering without resistance as costs rise. Unless...