E-commerce: Cash-on-delivery deals not authorised, says RBI

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Source: Gadgets Now


Cash-on-delivery (CoD), which accounts for almost half the ecommerce purchases in the country, could be a regulatory grey area, going by the Reserve Bank of India’s reply to a Right to Information (RTI) query.

However, some legal experts said the rules don’t necessarily invalidate cash-on-delivery. The Act mentions electronic and online payment, but doesn’t make explicit mention of money received through the cash-on-delivery route.

The query had asked RBI to “confirm if cash-on-delivery payment collection and disbursement to ecommerce merchants by ecommerce marketplaces such as Flipkart and Amazon (are) covered under the definition of payment system and system provider of the Payments and Settlements Systems Act, 2007, No. 51 of 2007 by acting as intermediaries and system providers. If yes, are these payment systems authorised as per Section 8 of the said Act?” To be sure, the central bank hasn’t laid down the law with respect to such transactions.

“RBI has not issued any specific instruction in this regard,” RBI said in its reply.