In the last few years, there has been an unprecedented growth in the number of direct-to-consumer (D2C) brands in India. Advanced technology tools such as no-code website building tools, simple designing web-apps, and the whole ecosystem around startups, has made D2C lucrative and relatively easier to start.
While you might feel that starting up has become easier than before and you don’t have to go through the same rigours your predecessors dealt with, that’s not entirely true.
You still have to deal with the challenges that a new startup faces. Only with time will you be able to gain your customers’ confidence.
One of the major challenges that D2C brands see in their initial years is that customers in India prefer to choose cash-on-delivery rather than pre-pay for their purchase digitally.
If you too are in that boat and are looking for ways to tackle this issue, read on to find the solution. But, before that, let’s briefly understand the problems of cash-on-delivery.
What are the challenges of cash-on-delivery?
Cash on delivery was the preferred choice of payment in India in the initial years of e-commerce. In fact, online shopping websites were proud to offer customers to pay for their purchase at the time of collecting the product.
In the early 2000s, digital payments were unheard of, and thus it made sense for e-commerce companies to offer cash-on-delivery. But at a time when people pay digitally even for their groceries and morning tea, cash-on-delivery doesn’t make sense for many.
However, this is the truth that almost all new D2C brands have to face. Many Indian customers are almost always reluctant to give their card details on a website they have not heard of. And in such a scenario, D2C companies have no option but to allow customers to pay via cash-on-delivery.
Here are a few challenges of providing cash-on-delivery payment option:
- Extra cost to handle cash
- High risk of customer not accepting the delivery
- Have to spend extra on reverse logistics
- Longer reconciliation time
- Cash is blocked with the courier company until the latter transfers the money
As you can see here, this is not a very useful solution for D2C startups and can adversely affect the company in the long run.
Want a solution using which you can bypass this cash-on-delivery issue? Start using Paytm Payment Gateway.
How Paytm Payment Gateway can reduce cash-on-delivery
Paytm for Business has products that can either make cash-on-delivery obsolete or improve the doorstep collection of money.
Here are the two solutions from the kitty of Paytm for Business that your D2C company can use to get rid of cash-on-delivery:
- Paytm Payment Gateway
The primary reason customers shy away from using their debit or credit cards on the website of a D2C company is an untrustworthy or an unknown payment gateway.
To begin with, they are buying from your website for the first time because they love your products or services. But when they realise that they will be giving access to their sensitive card details through a payment company which they haven’t heard of before, they may either drop out or choose cash-on-delivery.
Interesting Read: Paytm PG Brings Cutting Edge Digital Payments Tech For SMEs
But since Paytm is already a large payment app used by almost everyone in the country, the name of our payment gateway gives them a sense of familiarity and trust.
In fact, Super Smelly, a D2C company saw an uptick in their users buying from their website and paying online only after it started using Paytm Payment Gateway.
“The sense of credibility that customers feel when they see Paytm on our website is the same when they see Visa or Mastercard. This one brand suddenly got me a lot of credibility from my customers. Even if it’s a 600 bucks product, the buyer feels that their money is safe since Paytm is handling the payment,” Dipali Mathur, founder of Super Smelly said.
Read the whole interview here.
Benefits of Paytm Payment Gateway
- Industry-high success rate
- Settlement in one working day (T+1)
- 100% secure payments
- Support for all payment modes
- EMI and Buy Now, Pay Later options
- Checkout with saved cards with tokenisation
- Understanding of payment analytics from the dashboard
- Paytm All-in-One POS machine
Most of your problems related to cash-on-delivery are going to go away with Paytm Payment Gateway. However, if there are still a few of your customers who wish to pay at their doorstep, you can empower your delivery persons with Paytm All-in-One POS machines.
With Paytm All-in-One POS machines, you don’t have to worry about handling cash. These POS devices can easily process payments from debit or credit card, payment apps, QR codes, and even Sodexo.
The UI/UX of the Paytm All-in-One POS machine is simple and delivery persons can easily learn how to handle them.
Our POS device is light-weight and easy to carry, which can fit in a palm.
Benefits of using Paytm All-in-One POS machine
- Supports all payment methods
- Integrated billing management
- One-window reconciliation
- Customised POS solutions
- Special bank offers
Conclusion
There is no need for your D2C brand to subject itself to cash payments when there are enough tools to bypass this. Paytm Payment Gateway and Paytm All-in-One POS are two apt solutions that can urge your customers to not pay in cash.
