Cash-on-delivery
The government has started an inquiry into the imposing extra charge on the cash-on-delivery (COD) order by the e-commerce platforms. It has been called a “dark pattern”, which misleads customers and takes advantage of them. Let us tell you in detail what this COD charge and dark pattern are and how e-commerce companies earn through it.
Earlier this year, the customers complained that some platforms are putting ‘cash handling charges’ on the COD order. In July, Zepto users complained on social media that hidden charges are being levied during the checkout. These charges can be part of “drip pricing”, which is one of the 13 dark patterns in India and is considered illegal.
What is COD charge?
Cash-on-delivery (COD) is a payment method in which the customer makes cash or digital payment at the time of order delivery. E-commerce companies offer it to customers to increase trust in online shopping and provide convenience. They apply the cod in association with the delivery partner, where courier collects payment. For example, if you order some goods from an online e-commerce company, there are two-three options to pay there, one is the option of paying from UPI with a credit card and one is a cash-on-delivery. If you choose a COD and suppose order a mobile cover of Rs 1500, then at the time of delivery, you will have to give the delivery partner for Rs 1500 in cash or cash.
What are dark patterns?
Dark patterns are tricks that are used in websites or apps so that customers are fooled. It can be a hidden design or misleading language, which forces users to do something that they do not want.
- Hide the delivery charge until the last step.
- Consent box in advance.
- Only 1 product is left like showing false messages.
In November 2023, the government banned 13 such dark patterns under ‘unfair trade practices’, including drip pricing, false haste, subscription trap and hidden advertisements.
How big is this problem in India?
According to the 2024 ASCI report, 52 out of India’s top 53 apps were found to have a dark pattern. These can be hidden charges, frequent pop-ups, or misleading designs. This is especially common in e-commerce, fintech and gaming apps. Customers often find out later that they were cheated.
What is the government doing?
Along with checking the cod charge, the government is tightening the digital fraud. On May 28, the ministry held a meeting with e-commerce companies and asked them to audit their apps. Also, there is a plan to form a joint working group, which will monitor these problems. In the investigation, it will be seen whether the customers were clearly told about the charges.
What will happen next?
If a platform is found to be using dark patterns, it may apply penalty, design changes or strict rules. COD is a very popular payment method in India, especially in small towns. Therefore, this investigation is very important. This step of the government shows that now the fees and design will be checked as strictly as pricing and advertising.