Government Expresses Worry Over Accusations Against Edtech Businesses

The suspected misselling of courses by edtech companies has attracted the serious attention of the authorities.

People informed of the situation indicated that complaints against Byju’s and group companies were brought up during a conversation since the edtech leader serves a sizable student base.

On June 24, at a meeting with tech businesses and its self-regulatory body India edtech Consortium (IEC), the consumer affairs department voiced its worries about these and other factors, according to people briefed on the situation for ET.

Senior department officials also voiced their concerns to executives at Byju’s, India’s most valuable startup, in a follow-up call that day, the sources said. They claimed that the majority of the complaints they had received were regarding the Bengaluru-based business and its group entities. The conversation was also joined by Divya Gokulnath, co-founder of the business and Byju Raveendran’s wife.

Thereafter, according to a second source with knowledge of the situation, Gokulnath, and top executives presented officials with a thorough action plan to resolve the allegations.

The department representatives mentioned at the meeting that they had 147 consumer complaints against edtech businesses, the sources said. It is anticipated that it would soon provide the edtech businesses with the whole list of complaints. Along with other concerns, aggressive misrepresentation of products to parents and specific advertising promises were considered. It was suggested that Byju’s collaborate closely with the Indian Advertising Standards Council (ASCI).

According to the industry self-regulatory authority ASCI, 33% of the 5,532 advertising it reviewed in the prior fiscal year were complaints from the education sector, which includes both edtech companies and conventional educational institutions.

The growing number of complaints against edtech businesses, which also entail the misselling of loans or financing possibilities for different courses that these platforms are offering, has made the authorities apprehensive, the source continued.

The matter is significant because Byju’s has gained notoriety and any action taken against the company would be detrimental to other businesses operating in the same industry.