Retail Payments – Digital Cash on Delivery

The number of websites where vendors and customers directly conduct business with each other is growing steadily. Recent examples of successful peer-to-peer (P2P) platforms are Airbnb (apartments) and Uber (taxi).

Until the appearance of the so-called blockchain technology, a third party (bank, credit card, etc.) was always needed for the financial execution of the services used. The blockchain technology, who’s first known application is bitcoin, enables the transmission of values (money) on the internet and is considered by many as one of today’s main, disruptive technologies. The implementation of blockchain technology does not only make the middlemen unneeded, redesign of processes can change business fundamentals. One of these processes is the payment of goods ordered over the internet. The delivery service can facilitate the P2P financial settlement between the vendor and customer as an independent third party.

Quasar: payments based on blockchain technology

Quasar is a blockchain technology based payment solution developed by Quantoz Technology. Quasar payments are made between digital wallets. These are digital accounts in which assets (in this case digital money) are stored. These wallets are linked to a traditional bank account. Quasar wallets offer customers and vendor a fast, cheap and attractive method for payments of online ordered (physical) goods.

Cash on delivery process with Quasar

Instead of handing over large amounts of cash money to a postman (for example, German Post accepts COD payments up to 1.600 Euro, Swiss Post up to 10,000 SFr), the customer pays the amount due from their Quasar wallet to an escrow wallet with the purchase. This transaction is – similar to a bank transfer – irreversible. The transfer from the escrow wallet to the vendors´ wallet takes place after the customer confirms receipt or the postman, acting as a notary for this transaction, confirms the delivery to the customer. Since this transfer is cashless and carried out as an electronic signal, the amount is immediately credited to the vendors’ wallet. If the delivery period is not adhered by the vendor, the escrow wallet can transfer the money back to the customers’ wallet automatically.

Customer and vendor protection with Quasar

Customer and Vendor protection are equally respected when using an escrow wallet, and both benefit from the convenience of quick money transfers. Unlike traditional instant payment methods, Quasar provides more than just a “promise to pay”: not only is the money already deposited in the escrow wallet by the customer with the purchase, the money is transferred to the vendors’ wallet at the moment of delivery. Also, returns and refunds are handled fast and efficient via the escrow wallets.

The new role for the delivery organization

Delivery services already accept cash on delivery on behalf of their clients (vendors). This is costly and also exposes the parties involved to security risks. Using digital wallets, the delivery organization can offer their customers a new payment functionality without changing the delivery process. Only the delivery service can offer this service because it is ultimately the organization that is trusted by both parties. This position opens up new possibilities to generate revenue and enhance the delivery process.