Etailers tie up with agencies to confirm customer identity before shipping goods to reduce losses; but will it help?

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Seller malpractices like fake products and unethical selling practices have always been in the scanner, with never-ending debates on who should be blamed for these – online sellers or online marketplaces. Fact remains that customers too can be at fault, the rising number of cheating cases testimony to this.

Many incidents came to light like delivery boys getting beaten up, robbed at gunpoint, locked, theft, fraud, pranks, fake accounts and so on. They were rumours too that ecommerce biggies like Flipkart and Amazon had stopped delivery to certain areas in UP and Noida. But they dismissed these claiming that delivery wasn’t stopped, only certain restrictions were imposed on cash-on-delivery orders.

Countering the mishaps from customers

The cash-on-delivery option is such that customers have the right to refuse the products if they are not happy with them, thus not paying for them. This adds to the cost for etailers resulting in losses. Add to that the woes of faulty mailing addresses and etailers are now looking at options to keep their losses in check.

Many online marketplaces like Flipkart and Snapdeal are looking at companies, which can assist them to check out the details of customers before sending out their orders.

Tie-ups with agencies

For years, banks have faced similar problems of money recovery and cheating from customers. Taking a leaf out of their experiences book, ecommerce companies have begun to tie up with telecom operators and agencies to help figure out the identity of customers.

The liability is on the merchants in the case of online transactions. Zumigo, a startup, tries to identify customers and check fraud, with help from merchants and bureaus. We identify the name and address through mobile number and credit card information. This is enabling security and identity,” said Chirag Bakshi, chief executive of Zumigo.

With the help of telecom companies, it can be identified whether the customer is present on the location specified by him for delivery. This is especially helpful for COD transactions where there is a chance of refusal from the customers. If found to be a fake address, online marketplace can save on the cost of delivery; thus helping them to cut down on loss from that operation.

However, getting information from a credit agency may not be so easy because credit agencies are not allowed to give out secure information about a customer. “We are regulated under Credit Information Companies Regulation Act (CIRCA), which does not allow us to share information with anybody other than specified user,” said Mohan Jayaraman, managing director of Experian Credit Information Company of India.

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