Zomato reports that following the RBI’s pronouncement, 72% of cash-on-delivery orders have been paid for with Rs 2,000 notes.
Nearly three quarters of Zomato’s users opting for cash-on-delivery have been paying with Rs 2,000 notes since Friday when the central bank announced the withdrawal of the currency note, the food and grocery platform said Monday.
“Since Friday, 72% of our cash-on-delivery orders were paid in ₹2000 notes,” the company tweeted. A source at the company explained that while a majority of the cash-on-delivery orders over the weekend were paid using Rs 2,000 notes, the number of such orders did not grow significantly.
Ecommerce, food and online grocery segments are also likely to witness an increase in customers opting for cash on delivery as they seek to get rid of the Rs 2,000 banknotes, Internet industry insiders said. Online ride hailing platforms largely remained unaffected.
The central bank had clarified that the Rs 2,000 notes would continue to be legal tender, and that the public could deposit the banknotes into their bank accounts or exchange them for banknotes of other denominations at any bank branch.
“There’s no major spike in cash-on-delivery orders that we’ve seen. The option is already on a high base with people in ecommerce and grocery categories still primarily opting for cash-on-delivery. But these segments along with food are likely to see some increase in cash-on-delivery in the short term because of the announcement,” a senior executive at a Gurgaon-based logistics services provider said.
“You would more likely see people using the Rs 2,000 notes for products where ticket sizes are generally higher. So, spending avenues such as eating out at restaurants, petrol pumps, physical shopping at supermarkets and malls has a higher likelihood of this happening,” the executive said, adding that it was the top choice of payment for ecommerce platforms in tier-2 and tier-3 locations and first-time shoppers.
As of December, cash on delivery accounted for about $30 billion of India’s ecommerce market, according to ecommerce enabler GoKwik.
A top executive at a large payments firm which focuses on merchant transactions told ET that as of now there have not been any material impact on their transaction volumes.
In the larger payments ecosystem, cash logistics and ATM players might feel some impact given they will also have to move Rs 2,000 denomination notes from the currency chests to the bank. But otherwise, the impact is minimal.
“Banks have been phasing out Rs 2,000 notes for a while now, in fact, we have recalibrated 90% of our cash machines with Rs 500, Rs 200 and Rs 100 notes, so the remaining will be recalibrated in the coming months too,” said a top executive at a cash logistics company. These players help banks move cash and refill ATMs.
Cash recyclers — machines which accept deposits as well as spew cash — will need to have a unique arrangement. They will be accepting Rs 2,000 notes but will not be dispensing them out. These notes will be collected and returned to the banks.
Overall industry insiders pointed out that with the strength of the payments ecosystem and the time given by the regulator, demonetisation of Rs 2,000 notes should not create a big impact like last time. On the contrary, it could push up deposits with banks for the short term, they said.
