CIOInsider India Magazine
PhonePe to Digitize Flipkart's Cash-On-Delivery
PhonePe, a digital payments platform, announced a partnership with Flipkart to enable the e-commerce giant's items to be paid for upon delivery.
Customers who previously chose 'cash on delivery' would be able to pay digitally at the time of delivery using any UPI app.
This will assist customers who are more comfortable with cash on delivery reduce physical interaction while guaranteeing safety and drive contactless payments.
“Thanks to UPI, digital payments have grown more widely accepted in recent years. Some consumers, however, continue to prefer cash on delivery at the time of delivery”, Ankit Gaur, PhonePe's Director of Business, stated.
He went on to say that digitizing these cash-based payments would help not only e-commerce but also the bigger picture of Digital India.
"While the pandemic has prompted many consumers to switch to online shopping, there is still some confidence deficit during checkout”, said Boyanapalli.
"Not only does our solution provide customers with a seamless and contactless payment experience, but it also helps e-commerce and logistics organizations cut cash handling costs”, he said.
Flipkart announced a partial spin-off of PhonePe in December last year, after the digital payment company raised USD 700 million in capital, valuing it at USD 5.5 billion.
"As the distinctions between e-commerce marketplaces and digital payments blur, it's more important than ever to address customers' changing wants and views”.
Flipkart's 'pay-on-delivery' technology aims to provide customers peace of mind about their payments while also allowing them to buy in the comfort of their own homes, according to Ranjith Boyanapalli, Flipkart Head (Fintech and Payments Group).
"While the pandemic has prompted many consumers to switch to online shopping, there is still some confidence deficit during checkout”, said Boyanapalli.
Flipkart has over 300 million registered customers and sells over 150 million products in more than 80 categories. SoftBank Group Corp has approached Flipkart to discuss a $ 700 million investment in the e-commerce company.
As a result of the agreement, the Bengaluru-based firm is likely to be valued at $25-30 billion.
Last July, Walmart led a $1.2 billion round in Flipkart, valuing the company at $24.9 billion. The Bentonville-based company (in Arkansas) is competing for domination in India's online retail industry with US rival Jeff Bezos-led Amazon and Mukesh Ambani-owned Reliance's JioMart through Flipkart, which it bought for $16 billion in 2018. Flipkart, a Walmart subsidiary, and PhonePe, a digital payments firm, both seek to go public in the United States by 2022.
