Digital payments platform PhonePe on Monday said it has partnered with Flipkart to enable pay-on-delivery service for the e-commerce major's orders.
PhonePe's dynamic QR code solution will enable customers who earlier opted for "cash on delivery" to pay digitally through any UPI app at the time of delivery, PhonePe said in a statement.
This will help reduce personal contact while ensuring safety and drive contactless payments for customers who are traditionally more comfortable with cash on delivery, it added.
"Digital payments adoption has become widespread over the past few years, thanks to UPI. However, there still continues to be a preference for cash on delivery among some customers at the time of delivery," PhonePe Director (Business) Ankit Gaur said.
Digitising these cash-based payments would give a major boost to not just e-commerce but also contribute to the larger goal of Digital India, he added.
"Our partnership with Flipkart to enable contactless and safe payments for its "pay on delivery" customers is a big step in that direction.
"Our solution not just offers a seamless and contactless payment experience to customers but also helps to reduce cash handling costs for e-commerce and logistics companies," he said.
In December last year, Flipkart had announced a "partial spin-off" of PhonePe as the digital payment firm raised USD 700 million in funding, valuing it at USD 5.5 billion.
"As the lines between e-commerce marketplace and digital payments continue to converge, it becomes imperative to solve for customers' evolving needs and attitudes.
"While the pandemic has urged several consumers to make a shift to online shopping, some trust deficit during checkout remains in pockets," Flipkart Head (Fintech and Payments Group) Ranjith Boyanapalli said.
With "pay-on-delivery" technology, Flipkart wants to ensure that customers have peace of mind with their payments and at the same time can shop within the safety of their homes, Boyanapalli added.Flipkart has a registered customer base of over 300 million, and it offers over 150 million products across more than 80 categories.