The COVID-19 pandemic that unfolded recently has resulted in a significant change in the way transactions are carried out today. While the demand for goods and services is increasing, many e-commerce businesses and online gaming companies are struggling with their manual financial processes to get instant access to their customers’ bank account details for refunds and prize money.
E-commerce is one of the largest online businesses in India today. Granted that most e-commerce businesses accept payments online, over 60% of Indian consumers still prefer CoD (Cash on Delivery) over making an online transaction.
This mode of payment creates a gash in the system for businesses if their customer wants to return their purchase since the business does not have the bank account details of their customer.
Let’s face it. On average, about 30% of online businesses experience returns. Since CoD facilitates a big chunk of online purchases, this is not a problem that can be overlooked.
What is RazorpayX Payout Links?
Payout Links is the easiest and fastest way to disburse funds into your customers’ preferred bank account via IMPS, UPI, NEFT, and RTGS.
What problem does Payout Links solve?
Like we mentioned before, CoD refunds are something that most e-commerce businesses face. The process is manual, not to mention time-consuming.
Here’s what happens when a customer returns their purchase, opting for a refund.
- The business sends out a form or an email which the customer needs to fill out with their bank account details
- The business hands the details over to the team responsible for making payouts to complete the refund process
- If the customer does not respond to the email or form, an agent from the company reaches out to them via call or email
So, what’s wrong here?
The first thing that’s happening here is that once the business receives the information sent by their customer, they actually have no way of verifying the validity of their account information.
Next, the finance team will collate the information and make a one-off payout by uploading the account information on the bank’s portal, or make a bulk payout if there is more than one refund.
There are multiple iterations for something that can be very straightforward. The business, the finance team, and customer care executives are involved for the refund to take place successfully. This takes up many many hours of manual processing, while this time can be utilised for other important tasks.
This is why a refund takes 5 to 7 business days, making it difficult for both the business and their customer.
Can you imagine this entire process carrying through in minutes? That is precisely what Payout Links can do for your business.
How does Payout Links work?
Payout Links helps automate the entire process of making a refund to your customer within minutes. All you have to do is create a Payout Link on your RazorpayX Dashboard by entering your customer details along with the amount that needs to be refunded. You can send the Link to your customer or have RazorpayX send it out.
Also, if you need to create several Payout Links, you can use APIs to create them in bulk. Now that your customer gets the Link, the process is done in a blink.
Here’s what happens next.
- Your customer opens the Payout Link and verifies themselves via OTP
- They enter their preferred account which can be a bank account, or their UPI ID
- On successful entry of their account details, they receive their refund almost immediately
- Your customer is notified if there is any error with the account details they have provided, so they can re-enter the details or try with a different account
Why make your customer wait for 5 to 7 business days? With Payout Links, you can easily reduce the multiple touchpoints and automate the process, and make the refund in a few minutes! Talk about elevated customer experience!
Bonus: If you have already made a refund using Payout Links to your customer, their account details automatically populate the next time they receive a Payout Link from you. However, they can still add a different account if they choose to.
Popular use cases
To further help you understand how you can make the most of Payout Links, here are the top use cases.
E-commerce: Like we discussed before, e-commerce companies that don’t have a wallet of their own, or need bank account details to set up a customer account, can make use of Payout Links to make refunds to their customers.
Rental businesses: Most rental businesses take an upfront security deposit for the rental services they provide. And, once the rental period is over, they refund the security deposit to their customers after making internal quality checks. Payout Links works best for this use case.
Online gaming: Gaming companies (and other companies) that offer rewards, cashback, and reimbursements to their customers can use Payout Links to disburse money in real-time, since instant gratification is very important in these cases.
Suggested reading: Money Movement Decoded for Online Gaming Companies