Consumer Affairs Secretary Rohi Kumar Singh reassured the direct selling industry on Friday, stating that the government would not interfere with its business model as long as it adheres to ethical standards. However, he cautioned that the authorities would not hesitate to intervene if any malpractices, such as money circulation or ponzi schemes, are detected. Singh’s remarks come amid concerns and specific instances where direct selling businesses have been associated with questionable financial activities.
Addressing a conference organized by the Confederation of All India Traders (CAIT), Singh emphasized the importance of maintaining transparency and ethical conduct within the industry. “As long as you are right, we are with you. But if money circulation is involved, subscription is not explained, then the government will interfere. You cannot take the government for a ride,” he warned.
The government has previously taken action against certain entities in the direct selling industry for alleged wrongdoings, highlighting the need for vigilance and compliance with regulations. Singh acknowledged that the direct selling sector faces challenges related to public perception and urged industry players to enhance clarity in their business models.
“The problem with your industry (direct selling) is perception… I am sure you are doing right, but you need to work on your perception,” he remarked, emphasizing the importance of creating a positive image for the industry.
Singh also acknowledged the complex nature of product distribution through multiple layers within the direct selling model. He assured that the government does not intend to interfere with the fundamental structure of the business model but stressed the need for ethical practices.
CAIT Secretary General Praveen Khandelwal highlighted direct selling as an integral part of the retail trade, with the current market size at Rs 50,000 crore. The aim is to double this market size in the upcoming year. Khandelwal emphasized the need to identify and address any negative elements within the industry.
As a testament to the industry’s significance, CAIT announced plans to organize a conclave of women direct sellers in the national capital on March 8, marking International Women’s Day. This initiative aims to celebrate the contribution of women to the direct selling sector and promote their active participation in the industry.