The amount of use of Naver’s’Quick Settlement’ service, which took two months to receive the sales price, has been advanced to one day, has exceeded KRW 1 trillion. It has been 4 months since the service started. It is evaluated that it is in contrast to general e-commerce companies such as Coupang, which takes more than a month for small and medium-sized business (SME), who have difficulty in raising working capital, to receive settlement.
Naver Financial announced on the 3rd that it had settled the sales price of about 1 trillion won to SMEs through the fast settlement service. The average daily payment is about 20 billion won, the largest in the online e-commerce industry, Naver Financial said.
Naver Financial’s fast settlement service is a service that pays 90% of the sales price to SMEs free of charge the day after delivery. You can apply for the quick settlement service if the Naver Smart Store sales are over 1 million won per month for at least 3 consecutive months. If you are selected as a fast settlement target company, you can use it without limitation on the settlement amount.
Naver Financial will return the money received to the buyer if the purchase is canceled within 8 business days, even if the purchaser makes payment and delivery is completed. Through the quick settlement service, the settlement was made before the purchase was confirmed, but if the buyer cancels it, there may be a temporary deficit in Naver Financial’s cash flow.
Naver Financial’s fast settlement is possible because it can evaluate the reliability of a store company using smart store data. Naver introduced a risk detection system (FDS) to predict the possibility of a purchase cancellation request coming from a purchaser when the fast settlement service is applied. This is a method of evaluating the companies entering the store based on the return rate or the percentage of regular customers. An official from Naver Financial said, “Because we do not conduct financial business with the sales amount we received, we can settle it right away. We have shortened the settlement period, which took 9.4 days after payment, to 4.4 days, one day ahead of the target.”
Coupang, which is attracting attention with Naver, also introduced an immediate settlement service in May of last year, where up to 90% of the payment is settled the day after the sale. However, unlike Naver, it is a loan product operated with Kookmin Bank and receives an interest rate of 0.013% per day (4.8% per year). If the immediate settlement service is not used, it takes more than a month for the seller to receive all payments from the purchase confirmation date.
It is difficult for Coupang to introduce a selected service like Naver because of the shortage of cash due to a subsequent deficit. The sales price is an outstanding payment that the platform has to reserve for a while and then transfer it to the store company. Shorter settlement cycles lead to less payables and weaker cash flow. It is an analysis that Coupang, whose monthly transaction amount exceeds 1 trillion won, has to give up most of its liquidity in order to accelerate the settlement cycle. According to a stock report filed with the Securities and Exchange Commission (SEC) for listing Coupang, the credit value (trade payable) to be paid to Coupang suppliers was $1,6585.85 million (1,1958 billion won) at the end of last year in 2019 It increased by 155% from $ 4165.01 million).
Reporter Park Jin-woo [email protected]
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