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- commercio online e fatturazione
Cash on delivery is one of the ways in which the customer pays the amount due for the receipt of the good or service purchased. Until a few years ago, this method had been supplanted almost exclusively by credit cards, but in recent times retailers, especially in the e-commerce sector, have reintroduced the possibility of paying the amount due directly to the courier who will take care of the delivery. What are the conditions that most online retailers apply to cash on delivery?
Are there additional costs for this service, considered by many customers to be preferable to the digital methods provided with PayPal, cards and bank transfers? This guide will analyze the main aspects of this purchase instrument, any costs applied to the final price of the goods and the reasons underlying these policies.
Ultimately, it is necessary to underline how a recent sanction applied by the Antitrust against some major airlines has issued heavy penalties for the application of additional costs for payment instruments other than credit cards. In particular, bank transfers and cash on delivery are in the sights .
In fact, the reason for the Antitrust decision is in line with the European Directive 2011/83 / EU , which regulates consumers' rights. According to this legislation, implemented in our country by the Consumer Code, if the seller applies a surcharge, connected to the cash on delivery payment or by bank transfer, the violation of consumers' rights would be triggered and, in particular, art. 62 of the Code .
How cash on delivery works: operational aspects
Cash on delivery is a payment method that provides for the delivery of cash to the express courier who will take care of delivering the goods to the recipient. In this case, the sum of the sales contract will be transferred to the seller by the shipper, who will deliver the goods only if the payment is successful. There are mainly two methods of cash on delivery payment and these provide for cash, or the transfer of funds by credit card or smartphone equipped with related digital apps.
There are not many couriers that have a POS but, for example, payment via terminal is often contemplated for home shopping services. In many respects, those who are not yet familiar with online purchases, or do not have sufficiently detailed feedback from the retailer, may find it safer to deliver the money only when goods have been delivered.
The advantages, for the most suspicious buyers, are obvious: the payment does not take place during the order phase, but upon receipt of the goods. For their part, retailers often apply additional costs to the cash on delivery method, because it is an additional service that the shippers apply to the agreed costs for dropshipping. Dropshipping is a type of sale that is based on the presence of three actors: the seller, the buyer and the shipper. The former does not physically own the goods sold to the buyer, who receives them from the carrier through an online ordering system managed by one or more locations in the warehouse where the goods are stored and available for collection.
If the payment is made by credit card, the seller receives the funds immediately, if the transaction is authorized. If, on the other hand, the amount is transferred by cash on delivery, a further step will occur: after the shipment of the goods, the courier receives the money from the buyer, if he accepts the package, and then he will have to send them to the seller.
The increase in costs linked to cash on delivery
The question of the increase in costs applied to cash on delivery is sometimes thorny, because the conditions of sale are not always totally transparent. Some sellers, in fact, apply commissions on the sums delivered to the shipper following receipt, while others simply add hidden costs.
So, although it seems that the price to be paid is the same, with the use of all payment methods, in reality the customer pays a higher amount, without knowing it. In some cases, however, the sales commissions, especially of some services, including the purchase of airline tickets, were known to the final consumer. In this case, however, it was not a question of cash on delivery, but by bank transfer.
As for the mark, it is not only the smaller carriers that apply a price increase, but also companies such as Poste Italiane. Suffice it to say that, for cash on delivery payments, Poste Italiane itself applies increases in rates. In this case, Poste places limits on the amounts to which the cash on delivery balance is applicable. But, in reality, this is not a form of protection against buyers, since the limitations have an essentially fiscal basis.
The maximum threshold, in fact, corresponds to € 1,030 for parcels sent by ordinary shipping, while to € 999 for express parcels . How to check any cost increases related to cash on delivery deliveries?
The simplest and most effective way is to proceed with the purchase, up to check-out, by monitoring the list price compared to the final price indicated on the screen. If the final cost far exceeds the initial cost, there are two choices: face the costs applied, or choose another payment method.
The surcharge on e-commerce purchases: a controversial issue
The sanctioning measures applied by the Competition and Market Authority, in violation of art. 62 of the Consumer Code , has posed a series of questions, both from customers and from scholars of the subject. The starting point is that, in 2016, the AGCM had sanctioned two airlines, Norwegian Airlines and Blue Air, for having infringed the rules of the European Directive and having applied a surcharge to transactions made by means other than credit cards. .
The amount of the very heavy penalties had been quantified at 250,000 and 300,000 euros respectively. Subsequently, in 2017, the Authority had issued other provisions against 5 electricity distribution companies, which established a surcharge of between 1 and 4 euros for the payment of bills in cash, instead of the recurring debit on the bank current account.
The clear violation of art. 62 of the Consumer Code or, in our country, had led a large group of customers to rejoice at this decision, deemed necessary after a period of great uncertainty and frustration. The Antitrust, in fact, had not endorsed the application of an increase in tariffs for the method of payment on delivery of invoices , but had hypothesized the possibility of a discount for the balance by bank direct debit and payment by credit cards.
On the other hand, this decision has also sparked bewilderment and much controversy. First of all, according to some economists and experts in international and online transactions, cash on delivery does not fall into the category of payment instruments. Consequently, it would follow that in this case it is not possible to apply art. 62 of the Consumer Code.
The result of these interpretative divergences is that, since the Authority for Competition and the Market remains, to this day, the body in charge of controlling the tariffs applied by companies to final consumers, the costs of goods and services from some operators, where it is possible to pay cash on delivery.
One way to remedy this situation, which is really very unpleasant, is entrusted to the competence and transparent entrepreneurship of the retailers, who are called to take a step back and agree with the shippers the most convenient rates, to reduce the costs associated with delivery services. and have a larger margin in cases where the customer wishes to pay the amount due in cash, directly to the courier.
To date, in fact, the rates of carriers are so diversified and the operators in the sector so numerous, that a healthy competition policy could lead online sellers to carefully evaluate the best rates available on the market, to increase their earnings, while avoiding to charge surcharges on the end customer .
Author: Stefania Tamberlani
CHIEF EXECUTIVE OFFICER
Stefania Tamberlani commercial, organizational and administrative hub of Arte e Informatica deals with relationships with customers and suppliers. He has a high level of knowledge in the configuration and management of the Joomla and PrestaShop platforms, from the configuration of payment methods to couriers, passing through the management of the catalog and orders.