The member companies of the Indian Direct Selling Association (IDSA) have demanded a clear policy framework for the direct selling industry in the country.
In a conference organised by the association in Kochi on Monday, members took a pledge to stand together against the continued harassment they face, supposedly because fraudulent ‘financial pyramid’ schemes and ‘direct selling’ companies are erroneously perceived to be the same. The conference has sought immediate operational clarity for the industry, exclusion from Prize Chits and Money Circulation Schemes (Banning) Act and formation of separate legislation for the industry.
“The industry seeks clarity over the legal framework to promote, facilitate and regulate the industry and to prevent unscrupulous elements operating under the garb of direct selling businesses thereby protecting the interest of public at large. Kerala government has already issued guidelines and is working in a proactive manner to come up with clear regulatory framework which can make Kerala Direct Selling Guidelines all-inclusive. The government is quite supportive, but at the ground level, reality is that the industry is facing operational problems. There is a confusion between ‘financial pyramid’ schemes and ‘direct selling’ entities due to lack of clarity on the operational aspects”, said Chavi Hemanth, secretary general, IDSA.
Amarnath Sengupta, chairman of IDSA said that the association has been continuously in talks with the government for several years and as an industry body association, would want to emphasize on separate regulation that should govern this industry.
“Since there is no definition in the statutory books of India on the business of direct selling, many fly-by-night operators are misusing the concept. In case any of consumer complaints each of the companies has their own consumer redressal mechanism. Otherwise it can be redressed through the civil laws and there is no criminality in the conduct of the direct selling industry”, he added.
Incorporated in 1996, IDSA is affiliated to World Federation of Direct Selling Associations established in 1978, which has 59 Direct Selling Associations across the world as its members.