While Amazon recently showed us its futuristic plans of delivery-by-drone, Amazon’s Indian extension has decided to take a more traditional approach. Amazon.in has begun pilot testing a new delivery scheme, by partnering up with the Indian Postal Service.
The partnership will help Amazon with expanding its reach to the more rural areas of India. The Indian Postal Service has over 150,000 post offices scattered throughout India, with 89% of them in more rustic and rural areas as opposed to major cities. In addition to expanding their physical reach in India, Amazon is also piloting a new Cash-on-Delivery (COD) payment option with the Indian Post Office.
One of the main issues with giving support to less urban areas is a lack of payment options. Many people in the villages and Indian countryside do not have the luxury of paying with credit or debit cards, and there are not many alternatives, as with Boleto Bancarioin in Brazil. Because of that, COD has become rather popular among customers from less populated areas.
The new approach to payments does require proper training and logistics. Amazon.in will work closely with the Indian Postal Service by providing combined training on how to handle COD and Amazon packages. The Indian Postal Service is currently working on new software to help with handling Ecommerce deliveries and proper handling of cash.
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Amazon.in is also preparing for the new delivery and payment system. By expanding its reach to more areas, claims of fraud, theft and damaged goods are expected to rise. Cash on Delivery also has its own issues, with refusal of payment and the chance of the recipient not being available at the provided address.
The move from Amazon.in comes shortly after they confronted the government on easing the FDI regulations in India. Most likely receiving a negative response from the government, Amazon.in is looking for more ways to expand and grow in India. If proven successful, the pilot can help Amazon reach the top of the Indian Ecommerce market with the ability to provide support for more people in more areas than their competitors are able to, despite limitations from the Indian government.
Soon we will be publishing an insight piece on Ecommerce in India, to help get a better grasp on the regulations and limitations, so stay tuned.
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