What is cash on delivery?

Cash on delivery (COD) is a payment method where the shopper orders online and pays only when the parcel arrives. Payment at the door can be in cash, but increasingly also by card, QR code or mobile payment.

The courier collects the money and transfers it to the merchant, minus a collection fee. Settlement usually takes longer than for an online payment, because the money moves through the courier's own process before it reaches the merchant.

Why shoppers choose it

COD appeals to shoppers who do not have a card, who do not trust an unknown online store, or who want to inspect the goods first. In markets where these reasons are common, offering COD can be a condition for reaching a large share of buyers.

The trade-offs

For merchants, COD brings higher return rates, collection fees, delayed cash flow and the risks of handling cash. Many merchants therefore combine it with prepayment incentives or limit it to certain orders.

What it means for payment operators

COD sits outside card processing, but your merchants still need to see it next to their other payments. A platform that records COD orders and reconciles courier remittances alongside online payments gives merchants one view of their revenue, and lets them steer shoppers toward prepaid methods over time.