Zepto - ED’s Parimatch Heat Reaches Zepto

Expert Analysis:

• Zepto has come under the Enforcement Directorate’s (ED) scrutiny as part of a broader investigation into alleged money laundering and promotional activities linked to offshore betting platform Parimatch.

• According to reports, investigators are examining whether promotional material related to Parimatch was distributed through Zepto’s platform and delivery ecosystem, including advertising campaigns and flyers.

• The development comes at a sensitive time for Zepto as the company prepares for a potential public listing, making regulatory compliance and governance standards increasingly important for investor confidence.

• Zepto has clarified that it fully cooperated with the ED and stated that the advertisement in question was managed through a third-party media agency arrangement, with no direct operational involvement by the company in any betting or gaming-related activities.

• The probe highlights growing regulatory scrutiny of digital platforms and intermediaries that may have been used, directly or indirectly, to promote offshore betting and gambling services in India.

• While no formal allegation of wrongdoing against Zepto has been established, the investigation could lead to tighter compliance requirements and advertiser verification processes across the quick-commerce industry.

• The episode underscores the increasing importance of due diligence in advertising partnerships, particularly as quick-commerce platforms expand their monetisation efforts beyond core delivery operations.

• Any prolonged regulatory overhang could create reputational risks for the company, especially ahead of its IPO plans, even though Zepto maintains that it had no direct relationship with the advertiser under investigation.