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Credibility in cash on delivery system

A disgruntled account/credit card holder of one of the leading banks disclosed that he received a call from his bank inquiring whether he had made three consecutive transactions consecutively amounting to around Rs 80,000/-. To his utter dismay prior to going to bed for a good night sleep, he told the bank employee that he had not made any transaction and was oblivious to what was being communicated to him. The account holder asked the bank employee to immediately block his credit card so that no more transactions were done. However, the employee of the bank expressed his inability and asked the account holder to write to the bank vis-à-vis this. The account holder felt helpless and determined forthwith to stop using any credit cards in the future and expressed his dismay regarding the red-tapism in the era of technology.

One wonders whether all e-commerce transactions are safe and secure in Pakistan. There are millions of educated individuals with robust purchasing power not willing to use internet-banking or purchase anything online for the fear of insecurity. Someone has to come up and bring about awareness convincing these individuals about safety of their transactions and the ease of the entire process. One must admit that the number of credit card holders has decreased over the last decade in Pakistan for numerous reasons. Debit cards are being preferred to the credit cards, however, the insecurity of transactions seems to be overwhelming since millions are not convinced to resort to e-commerce to the detriment of the economic growth in Pakistan. One very gigantic conundrum in Pakistan is the credibility of data owing to poor or no use of technology. Pakistan in vain has been making efforts for last couple of decades to document the economy. Documentation of economy is viable only through technology.

The Federal Cabinet eventually approved the much-awaited first-ever e-commerce policy framework last year paving the way for the documentation of the economy. This would be hugely beneficial if implemented in letter and spirit. Digital connectivity could result in credibility of data, documentation of economy and soaring revenue for the development of Pakistan at rapid pace. The world did it two decades ago, however, we have been laggards. Well, it is never too late. E-commerce transactions in Pakistan need to catch up with the rest of the world. We even today do not have streamlined process to quantify the sales volume of e-commerce sales since there seems to be poor digital connectivity and we are still a cash economy at large to the benefit of the tax dodgers and to the detriment of the economy and the country, to be precise.

As per one estimate, the size of the e-commerce industry in Pakistan is very trivial vis-à-vis the neighboring countries. E-commerce sales are believed to be less than Rs50 billion in Pakistan. On the contrary, e-commerce sales of many countries are more than the total global trade of Pakistan including imports and exports. Pakistan must discourage cash-on-delivery (CoD) payment method for long term sustainability. Digital payment system would revolutionize the economic growth and the revenue generation in Pakistan. There is no need to only bring so-called experts to enhance the revenue of the government. There is need to digitize the payment system which would eventually bring about marvelous results as per the need of the country.

There are plenty of hopes that in a couple of years, the incumbent government would go for digital payment system at full throttle and eliminate the prevalent CoD payment method. The elimination of CoD payment would result in elimination of corruption and concealment of resources. This implementation may be confronted by backlash and intentional delay to benefit the corrupt elements who would be losing at the end of the day.

We must not forget that Cash On Delivery (COD) is one of the most popular mode of payments not only in Pakistan but also in many other countries since it benefits the online businesses as they charge more from the customers.

One of the reasons for the rampant use of Cash On Delivery payment in Pakistan is that one does not need to own plastic cards to purchase and most importantly the money is paid once the product is delivered avoiding scams which are still quite rampant.

It would be prudent to register all internet-based retailers to digitize the payment system and to bring about the credibility of the e-transaction which is missing by miles even today.

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