What Is Cash on Delivery and Why Is It Popular?
Cash on Delivery (COD) is a payment method where the buyer pays for the ordered product only upon receiving it.
This method is popular worldwide, especially in countries with lower trust in online payments. Customers prefer COD because it provides greater control and security when shopping.
Cash payments versus card payments is a long-standing debate. The advantages of cash include anonymity and transaction privacy.
On the other hand, paying by card means you pay for the product in advance, which can help avoid potential issues—such as the courier not having enough change or leaving the package if you’re not home, since it’s already paid for.
Cash handling and collection are strictly regulated under the Law on Prevention of Money Laundering and Terrorism Financing.
According to legal provisions, individuals and businesses conducting registered activities must follow rules that prohibit cash transactions (banknotes) of €10,000 or more.
Studies show that over 60% of people still pay in cash. However, this payment method slows down delivery services and significantly increases costs and complexity.
Steps in the COD Process:
Participants in the Transaction:
COD offers several key benefits, especially for buyers who are wary of online transactions:
While popular, COD has certain challenges, particularly for sellers:
Cash on Delivery (COD) is especially popular in regions with low digital adoption and limited trust in online transactions. It is most commonly used by older populations, such as retirees, due to a lack of familiarity with digital services and established habits.
The typical users include:
COD is particularly widespread in countries like India, Turkey, and parts of Eastern Europe.
Both methods allow secure transactions between buyers and sellers.
Key differences:
For Buyers:
For Sellers:
Can you cancel an order after it has been shipped?
Yes, but it may incur return costs for the seller. Always check the store’s terms and conditions.
What if the goods don’t arrive?
Contact the store or courier service to initiate a complaint. This issue has been discussed in detail in our article: “Shipment Stuck at Customs.”
Cash on Delivery provides extra security and convenience, especially for buyers without access to online payments. However, it involves additional costs and requires careful attention from both sellers and buyers. Card payments are transparent and speed up the process. Still, without educating the older population, a full shift to card payments is unlikely in the near future.
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