As per an Economic Times report, Puma and department store chain Iconic have started offering their online customers an upfront 5 per cent discount if they choose digital modes of payment. Liberty Shoes charges an extra Rs 49 for a customer who prefers to pay at the time of delivery at their doorstep.

These companies have started discouraging the cash-on-delivery(COD) option, which currently accounts for about 65 per cent of online purchases in India.

According to VibhorSahare, Cofounder, ANS Commerce, between 10 per cent and 30 per cent of COD order are returned by customers compared with 5 per cent-15 per cent for pre-paid orders.

Paytm Mall discontinued the COD purchasing option more than a year ago. After offering discounts on pre-paid purchases, Puma’s share of digital transactions on its webstore went up to 64 per cent from about 61% prior to that.

COD has been the most popular payment mode among Indian consumers and has helped spawn a formidable e-commerce business in India.

E-commerce sites including Amazon, Flipkart and 1mg had suspended the COD option for some months from April as part of efforts to create contactless shopping in a bid to curb the spread of COVID-19. However, the sheer popularity of COD prompted them to restore the payment method recently.