The food ordering service has seen a 200% increase in order payments despite the COD option being disabled.
Food-ordering service Zomato has been doing brisk business despite the liquidity crunch among people, amid the government's move to demonetize Rs 500 and Rs 1,000 currency notes since November 8 midnight. Zomato has seen no impact on its order volume, in fact the orders placed on its platform since the government's move, have risen, the company's spokesperson told DNA.
The Narendra Modi-led government decommissioned Rs 500 and Rs 1,000 notes in a bid to clampdown on black money in the economy and thwart terror financing. The move saw people across the country rush to ATMs to withdraw money to the extent of the predescribed daily withdrawal limit, while e-commerce companies disabled the Cash On Delivery (COD) option or put a cap on the value of orders that could be placed under COD, while moving all their transactions online, to ensure seamless payments.
Zomato also disabled the COD option for all the restaurants listed with it across platforms "till liquidity comes back into the market to ensure a smoother experience for our partners as well as users."
Despite this, "we have seen a huge spike in our online order volumes," the spokesperson told DNA. There has been "a 200% increase in order payments and the business is already growing at a healthy 20% week on week," Zomato said.
Nearly 60-70% people shopping online in the country, still prefer the COD option against paying online, according to industry estimates. After the government's move to render the high denomination bank notes illegal, most e-commece companies saw a drop in their COD orders while others had to cancel orders or return the ones in transit to the seller, till the liquidity situation improved.
So what is the reason for behind the order volume growth for Zomato since demonetization?
"Since food is a smaller ticket item and the gratification is instant, people do not mind paying online and also to try out the online payment option in case they haven't before," the company's spokesperson said.
However, "this might be a concern for platforms where the ticket size of the purchase is much larger and the purchase is more discretionary in nature," the spokesperson added.
Since the 9th, 100% orders on Zomato have been paid online and "our order volumes have significantly increased," the spokesperson said.
While Zomato did witness a server problem with order payments throwing up 'Error: 0' earlier in the week, a customer care executive said it was because of the huge spike in online payments being made on the platform. The issue was soon resolved and users were able to make payments. "We are actively working with our banking and online partners to educate our users," Zomato said.
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