NEW DELHI: The government needs to carefully formulate policy intervention due to high consumer welfare dividend, CUTS International said in its study on “Status of E-Consumers in India: Consumer Welfare Index”.

In a study, surveying some 2000 online consumers from different regions of India, it was found that the degree of consumer welfare is quite high at 80%. 

The consumer welfare was gauged based on responses on five parameters – cost effectiveness, convenience, consumer confidence, grievance redressal and healthy competition. Each of the five parameters scores are determined by measuring consumer agreement on several indicators.

The data shows that e-consumers are not very comfortable with respect to sharing personal data and saving their financial data on platforms. They have also shown suspicion on the genuineness of products sold online, and hence given a low score. All these adversely affect overall score on ‘consumer confidence’ as reflected in the scorecard.

The study findings also suggest significant scope for improvement in the grievance redressal mechanism. Their scores were quite low with respect to satisfaction, timeliness and ease of complaint resolution.

While ‘electronic and appliances’, ‘apparels and footwear’, and ‘personal care and hygiene’ are mostly bought online by e-shoppers, they largely prefer offline mode for ‘grocery’, ‘home and kitchen items’, and ‘books and stationary’ as per the study findings. 

Interestingly, ‘time-saving’ featured ahead of ‘cost-saving’ as perceived benefits from e- commerce. As many as 82% of e-consumers feel that online shopping saves more time as compared to only 63% of e-consumers who feel that online shopping saves more money.

The study finds that as compared to males, females e-consumers have greater satisfaction with e-commerce and want lesser improvement in most parameters - convenience, consumer confidence, grievance redressal and healthy competition. Further, more females than males find e-commerce to be beneficial in terms of time-saving and cost-saving. This explains why females prefer online shopping more than males.

Moreover, highly educated e-consumers are more satisfied with e-commerce and find it more beneficial when compared to lower educated e-consumers. Further, more number of higher aged respondents found e-commerce to be beneficial for safe shopping during the pandemic, as compared to lower aged respondents, while both categories of respondents found e-commerce to be almost equally beneficial with respect to time and cost saving.

Looking at the high quotient of consumer welfare vis-à-vis e-commerce, CUTS International urges governments to guard against any sub-optimal policy intervention, which can go against consumer interests and further adopt a National e-Commerce Policy after due stakeholder consultation. 

CUTS International also recommend to e-commerce platforms and online sellers to curb the sale of counterfeit and pirated goods, which hampers consumer confidence with respect to online markets. E-commerce platforms should also better their grievance redressal mechanism.