PayU India’s online payment solution PayUPaisa has launched a new payment option called Release On Delivery (RoD) using which customers can release the payment for the product purchased online after receiving the product. The company states that this option has been launched with the intent of helping customers gain more trust on the merchants, while also helping merchants reduce the high transaction cost incurred through third-party Cash on Delivery (CoD) services. PayUPaisa claims that the average cost per CoD transaction borne by a merchant is as high as 8% to 10% as compared to an online transaction which costs 2% to 2.5%. Therefore CoD continues to be a challenge although it constitutes 60% of the transactions done through e-commerce sites such as Myntra and FashionAndYou. It is worth noting that most e-commerce sites except Amazon have a minimum order value to provide CoD for transactions. Flipkart has limited the transaction value of CoD in Uttar Pradesh to Rs 10,000. How does it work? During check-out, customers are shown multiple payment options such as credit card, debit card, netbanking or CoD to choose from. On selecting CoD, RoD payment option is also offered to customers. On selecting RoD, payment can be made through credit card, debit card or netbanking. PayUPaisa releases the payment to the merchant either on receiving information from the buyer or by default after 3 days of product delivery. It is also worth noting that eBay already has a similar feature known as PaisaPay available on its website for its buyers and sellers…
