Simpl, a checkout network, announced its vision to eliminate cash on delivery (COD) in e-commerce by 2028 in order to reduce merchant losses and fastrack the industry's journey towards profitability. It introduced an artificial intelligence (AI)-enabled Checkout Suite to eliminate cash on delivery for its rapidly expanding merchant universe over the next five years. 

The company aims to achieve this vision by working with ecosystem partners and through its industry-first innovations, including Pay After Delivery and Return-to-Origin (RTO) intelligence, among other AI-led offerings.

As part of the offering, Simpl has developed capabilities including Pay After Delivery, which allows merchants to block the transaction amount from the user's account limit and complete the payment after verified delivery. Its return-to-origin (RTO) intelligence lets merchants determine whether to show a CoD option based on user behaviour during checkout. 

This will help significantly reduce returns and frauds, which drain merchants' finances. In addition to the above, the suite offers Address Intelligence to help merchants understand the address's quality and identify any associated risks. 

The suite will soon be integrated with UPI Block and Debit, which blocks the money via UPI when placing the order and triggers a transaction after the delivery of the product to help merchants build trust with the consumers.

Eliminating cash on delivery assumes significance as it accounts for nearly 60 per cent of all online transactions in India, mainly due to a lack of trust in merchants by customers, and this becomes significantly high for emerging merchants. About 20 per cent of all CoD orders face return-to-origin problems as the customer is not obligated to accept an order as they are not invested in the transaction. 

This results in losses for merchants as they have to pay a fee to service providers delivering CoD orders and for the return of products, thereby impacting their bottom line. Industry estimates suggest that total CoD order losses for online merchants stand from $6 billion to $7 billion annually. With Simpl's Checkout Suite, merchants can build trust with consumers, reduce returns and losses, and fast-track their journey to profitability.

Several small and large enterprise merchants with millions of customers have recently integrated with the Checkout Suite, in a testament to its effectiveness in solving merchants' pain points. Among the early adopters, there has been as high as 30 per cent migration of Cash on Delivery users to prepaid in early results. User surveys also show that Pay After Delivery delivers a superior user experience when compared to other instruments.

Commenting on the introduction of Checkout Suite, Puneet Singh, chief technology officer at Simpl, said, "Indian consumers have shown a strong affection for Cash on Delivery with nearly six out of every ten customers opting for this convenient payment mode. The growth of India's e-commerce industry also goes hand in hand with the success of CoD. However, the merchants are struggling with high costs, RTO losses and onerous working capital requirements due to CoD, leading to losses." 

These solutions become important as lakhs of merchants are going online to meet the evolving requirements of millions of consumers nationwide. A report on India's e-retail market by Bain & Company estimated the market size to increase from $150 billion to $170 billion on an annual growth of 25 per cent-30 per cent and doubling market penetration from 9 per cent to 10 per cent by 2027.