The All India Online Vendors Association (AIOVA) has approached the Reserve Bank of India against Chinese e-commerce platform ClubFactory over default on payments and has appealed to the central bank to seize the company's escrow bank accounts.

E-commerce platform ClubFactory, which was among the 59 Chinese apps that were banned in India, has allegedly stopped payments to sellers on its platforms. This comes after the company is said to have suspended its India operations.

"Club Factory has not paid the pending dues to the sellers on the marketplace for over a month now despite them delivering the goods to the consumers," Aiova said in its letter to the RBI this week.

The association says ClubFactory is in violation as per the RBI's “Guidelines on Regulation of Payment Aggregators and Payment Gateways” of the Payment and Settlement Systems Act, 2007.

The association also alleged that ClubFactory was withdrawing money from the escrow bank account designated for merchant dues, and has south that the RBI seize these accounts.

AIOVA, which represents over 2000 online sellers, had last month filed a legal notice against the company, calling the force majeure clause invoked by the latter illegal.

The legal notice was sent to ClubFactory’s India registered company FutureTimes Technology India Private Ltd in July. The association threatened legal action for non-compliance.

AIOVA said it had received several complaints from sellers of non-payment, but did not have an estimate of the total dues owed by ClubFactory.

ClubFactory did not respond to CNBC-TV18’s queries. Apart from ClubFactory, some other e-commerce platforms such as Shein and Romwe have also been banned in India as per the June 29 order.