VietNamNet Bridge - Consumer confidence in e-commerce in Vietnam is lower than the average level globally, which explains the high percentage of cash payments and big losses of e-commerce firms.

COD is the choice of the majority of customers

Doing his military service, garrisoned in Can Gio suburban district, 50 kilometers from HCMC central area, Tuan Anh, 24, receives one parcel a week from the postman or deliveryman after ordering goods via Facebook or e-commerce trading floors.

After trying them on and considering them, Anh gives cash to the deliverymen.

“I’ll only make payment if I am sure the goods are satisfactory,” Anh said, explaining why he chooses COD (cash on payment) payment mode. 

A survey conducted by EIU has found that Vietnamese consumer confidence in e-commerce safety is lower than the average level in the globe. In Southeast Asia, Vietnamese and Filipinos have lower confidence in e-commerce than Thai, Singaporean and Indonesian consumers.

The young buyers like Tuan Anh, who like convenience and use smart mobile devices, are targeted customers for e-commerce firms. However, the COD payment mode chosen by the majority of customers is a long lasting headache for retailers.

Ha Ngoc Son from the HCMC Industry and Trade Department said that the quality of goods on e-commerce trading floors is a big concern not only for consumers, but for state management agencies. A recent survey found that 53 percent of customers do not shop online because the products they receive are not exactly the same as described on websites.

According to Simon Baptist from EIU, a survey conducted by EIU has found that Vietnamese consumer confidence in e-commerce safety is lower than the average level in the globe. In Southeast Asia, Vietnamese and Filipinos have lower confidence in e-commerce than Thai, Singaporean and Indonesian consumers.

Meanwhile, a survey by the Vietnam Security Network found that 33 percent of e-commerce websites bears serious risks related to consumers’ personal data. The lack of confidence is the reason why only 3 percent of Vietnamese make payments online.

COD is the choice of the majority of customers because it allows them to refuse goods  if they are not satisfied with the goods.

Vu Quoc Tuan from Lazada Vietnam admitted that the payments in cash still account for a large proportion in transactions via Lazada, which costs a lot of time and money to collect and count banknotes.

A representative of Leflair, a website for medium- and high-income earners, also said only one-third of its customers make payments via Visa or MasterCard, mostly because of the free delivery policy. Meanwhile, the remaining  customers choose COD and pay the delivery fee of VND25,000.

A survey conducted by Criteo’s partner found that 37 percent of customers pay in cash when getting deliveries, while 18 percent make payments via bank accounts. The same number make payments via portals connecting with an ATM. And 11 percent of polled consumers make payments with credit cards, while less than 10 percent use other payment modes.

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