DHL eCommerce has launched a new cross border Cash-on-Delivery (COD) service that means consumers will be able to pay for their international purchases in cash and only upon delivery. As DHL notes, in the Southeast Asia region this option will allow access to over 73% of the population who don’t have a bank account or access to similar products.
COD is available as part of the DHL Parcel International Direct service and is aimed specifically at sellers based in China and Australia delivering to consumers in Malaysia, Thailand and Vietnam. Collected cash will be remitted to a local bank account at destination (Malaysia, Thailand or Vietnam) or in the billing country (China or Australia) based on the local destination currency. Remittance will be made to sellers every fortnight and tracking visibility of the status of COD is available on the DHL portal.
Despite growing credit card adoption in Southeast Asia, the low level of credit card penetration has forced e-commerce retailers to offer alternative modes of payment methods such as cash on delivery, digital payments and in some cases paying in-store. This opens up a huge potential by reaching out to a new group of unbanked consumers and also meeting the needs of consumers who prefer to pay in cash.
– Charles Brewer, CEO, DHL eCommerce
Offering a service for cash on delivery obviously does make sense in areas where cash remains the predominant form of payment. But even in more financially sophisticated areas it also makes sense because of cultural norms. In the Middle east, for instance, it is normal to prefer cash on delivery for distance purchases.
