Here's How Ecommerce Firms Could Combat the Slowdown in COD Payments
40 pct of the high-value transactions done by COD
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We all are now aware of the fact that the demonetization of Rs.500 and Rs.1000 Indian currency will impact the ecommerce sector. The sector, which has been cashing in the Cash on Delivery (COD) phenomena so far, might now see this particular set of customers looking for an alternative option.
In an elaborate report published by RedSeer Consulting said that with 70 percent of overall e-tailing and 40 percent of the high-value transactions done by COD, the currently COD-only consumers will shy away from near term, especially high-value purchases.
Entrepreneur India asked some of the startups how they see demonetization impact ecommerce businesses
1. Vishwas Shringi, CEO & Co-Founder, Voylla
"This has resulted in delay of order delivery where a customer does not have cash in right denominations. We have facilitated option to convert all COD orders to prepaid for all the customers and have also ensured that our courier partners hold the orders for little longer for all the customers till the new notes are in circulation. Also, to enhance the experience at our end we are offering attractive offers where the customers can pre pay their orders.
2. Digendra Singh Rathore, CEO & Co-Founder, Fella Homes
"New generation real estate tech companies like Fella Homes want to be a major contributor to this paradigm shift in India. We are encouraging completely cashless transactions in our business flow where our tenants and homeowners can enjoy hassle-free transactions. To push it even further, we have initiated one of a kind model through which other parties can now make use of Fella Homes' platform to pay and receive rent payments online."
3. Mitali Tandon, Founder, Morning Fresh
"I think this decision forces vendors to find a solution that maintains customer convenience as priority. We are definitely seeing a stronger move towards wallet payments and finding solutions that are integrated with logistics to ensure customers can still pay on delivery through credit, debit or wallet options. While this might be a good decision in the long run, the short term effort of increasing payment options, customer education and change in customer psychology, is something we will have to watch closely."
4. .Roshan Kunder , Senior Manager - Digital Marketing & ECommerce Business, Baggit
This decision has also led many e-commerce companies to work towards different ways to make it easier for customers to transition from cash to digital payments. With digital payment methods like Digital Wallets, Plastic Cards etc, customers will start to get more comfortable with these modes. Also with the increase in the number of people turning to smartphones, mobile based payments is another simple way for customers wanting to shop at this difficult time and always.
5. Venugopal Ganganna, CEO, Langoor
"...The overall ease of transactions online with a card, along with mobile wallets, will actually help the e-commerce companies on the whole. We believe in percentage terms of overall retail, e-commerce growth will be faster than it would have been without demonetisation. People's comfort with card and bank transactions should increase on the whole, and that should help increase confidence in e-commerce transactions".