Cash on Delivery - A Dominant Payment Mode In India

Cash on Delivery – A Dominant Payment Mode In India

Remember when eCommerce saw a boom in India? A bunch of people were terrified with the thought of making payments online. Despite having issues, people have now found comfort in making online payments and transactions. However, Cash on Delivery is still one of the most preferred modes of payment.

According to Nielsen’s global connected commerce survey in Business insider, about 83% of shoppers in India favor paying with cash for their online payments. Customers still are warming up to the part where they have to input card information because of different online extortion dangers.

Why is “COD” still a more convenient option?

Despite the prevalence of secured and versatile wallets and net banking exchanges, a large portion of customers is inclined towards the Cash-On-Deliver model. Payment options like Net-Banking, Credit and Debit Cards and e-wallets cater to less than half of online purchases in comparison to cash on delivery. There are advantages to Cash on Delivery for the buyer. It has gained their trust and kept them at ease after they’ve placed an order. 

The dread, more commonly seen in middle-class Indian individuals, in the past few years. Subsequently, the concept increased the percentage of people buying things online and has also contributed to the substantial growth of the country.

Advantages of Cash on Delivery 

Delivery man making home delivery to customer.

Lack of Awareness and Trust

Being a developing country, there lie still pockets in the interiors of India. That isn’t digitized as yet. Most of these people living in the outskirts are not very acquainted with modern concepts. Like a bank account or have amenities like a good internet connection. Hence, they favor the familiar and trustworthy way of buying things online. In such cases, Cash on Delivery provides reliability and a convenient way to make payments.

The Security

A major advantage of Cash on Delivery is the security that comes with it. You are eliminating any chance of potential fraud that could happen. No finances are given out at any given point if you choose the COD option. The customers will only pay for the product after they get the product in hand.

Quality Check

While making purchases online, the customers do not get to see the product in motion or check the quality before payment, With COD, it is possible to check the quality of the product before payment. In cases where the product is defective or different, he/she can return it without paying for it.


The Pioneer Company of Cash on Delivery

Flipkart was one of the first three major eCommerce players in India to introduce and push COD. According to Your Story, OD represented 80% of overall orders for Flipkart in 2015. While 72% of orders placed from major cities across India were COD, and 90% of orders placed from smaller cities were transacted through COD. Soon after that, its competitors began offering other modes of payment.

In India, the framework designed with an intention to draw more attention to purchasers who were skeptical about making payments online. In an event where the customer is unable to take the order, it returned to the vendor.

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