India is a Cash on Delivery (CoD) country and most online retailers provide this very easy option for buyers on their sites. However, what's not known is that fulfilling CoD orders can become a headache for retailers thanks to increased overheads, extra manpower and further logistics. An option is RoD or Release on Deliver, which has been adopted by the likes of Snapdeal and eBay India already, but that's still only two examples in a massive sea of retailers.
If Gurgaon-based PayUPaisa has its way, that could soon change. PayUPaisa will release payments to merchants only after delivery has been confirmed, which gives the system its name. Founded in 2011, the PayU Group caters to 5,000 merchants in India across categories, but is looking to snap up some big deals now.Nitin Gupta, co-founder and CEO, PayU India says the company is hopeful 20 percent of all CoD orders will become RoD transactions within 9 to 12 months. “Large merchants like Tradus, The Mobile Store etc. are eager to go live with this payment option. We expect that in 9-12 months time, 20 percent of all CoD transactions will become RoD transactions,” he told TechCircle.
With PayUPaisa, the RoD option will pop up for those who opt for CoD. One can pay via credit card, debit card or net banking, but the amount will not be released to the merchant until the buyer confirms that they have received the product. In case the buyer doesn’t send any confirmation for three days after receiving the product, then the payment will be automatically released to the merchant.
Will RoD replace CoD?
Now, this isn’t the first time that such a payment option is offered. eBay India has such an existing model called PaisaPay, while Snapdeal has TrustPay. The most notable example outside India is Chinese e-retailer Alibaba, which has its own payment tool Alipay.
While the benefits are obvious, in the case of India, deliveries can be quite chaotic and disorganised at the local level. So in case, the buyer hasn't received the product even after the payment has been released, PayUPaisa has set up a dispute resolution team, and the problem will supposedly be resolved in 12 working days or PayUPaisa will refund the money, depending on the order. The company has also launched ‘All-in-One’ payment settlement solution to address problems related to money settlement.
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