Flipkart, Amazon, Snapdeal see 50% return of products from people who opted cash on delivery, thanks to demonetisation

When delivery boys delivered packages to people who had opted for cash on delivery, they had two choices-either take old banknotes or take the product back.

Post demonetisation, Flipkart, Amazon and Snapdeal area dealing with returned products as people who have old currency notes have no option left.

They are returning the products ordered as they have no cash to pay.

"This is a further loss to us as Snapdeal and Amazon charge us shipping fees on such orders," a spokesperson of All India Online Vendors Association (AIOVA) that represents1,500 online sellers told ET.

E-commerce marketplaces stopped cash on delivery after demonetisation announcement. High product return rate is a double whammy for online sellers as sales are down by up to 70% since the demonetisation drive, the AIOVA spokesperson said.

Sellers said cash on delivery return rate at Amazon has increased more than 20%.

Meanwhile, many of the top marketplaces have now opted for 'credit card on delivery' mode.

The AIOVA spokesperson told ET the body has approached the government to allow e-commerce industry to accept old notes in a transparent Aadhaar-linked manner. "If such a system is implemented, it will become a win-win for all stakeholders," he said. A Snapdeal spokesperson told ET there was a marginal dip in COD orders and since removing the Rs 2,000 cap, demand is trending towards normal.