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The Importance of offering Cash on delivery on your Website in India

The Importance of offering Cash on delivery on your Website in India

Almost all of us are into the e-commerce business and prefer online shopping. Most often, the cash on delivery or COD happens to be the preferred terms of payment among customers. Now, most of you might have a question: what is COD? Simply speaking, the term “COD” or cash on delivery is a mode of payment where the customers pay directly to the courier or the delivery executive through cash or card after receiving the product. Today, COD emerged as one of the most popular ways of transaction in the e-commerce sector.

Today, almost all nations running online business offer COD as the standard mode of payment for shopping. Among them, several countries including Thailand, India, and Bangladesh made the mode of payment very accessible.

How COD Fuelled the Growth of E-commerce in India?

Even with the rise in online payments over the last few years, cash on delivery continues to remain the most preferred mode of payment for Indian consumers. According to Nielsen’s Global Connected Commerce Survey, approximately 83% of customers in India prefer using cash on delivery as a payment mode for online purchases.

Customers prefer the mode of payment due to several reasons. Firstly, the tier 2 and tier 3 cities failed, having required awareness and infrastructure for making online payments. Secondly, most individuals fail to have access to smartphones and bank accounts that support online banking.

Despite owning one, Indian consumers hesitate to use their credit cards fearing the online fraud risks. A report highlights that 72% of people from major cities and 90% from major towns used COD while purchasing products from online sites like Flipkart.

Although there is a sharp rise in mobile wallets and net banking transactions, buyers still prefer the cash-on-delivery mode while making online purchases. Net banking, credit and debit cards, e-wallets, and other such online payment options account for only 30% of all online purchases.

Factors Contributing to Cash on Delivery

The following factors enhanced the rapid growth and popularity of cash on delivery:

  • Convenient
  • Familiarity with cash payments
  • Lack of secure payment gateways
  • Fear of online fraud
  • Lack of trust over online payments options

Importance of COD

Let us discuss its importance in brief.

Flexible Payment Options for Customers

The cash on the delivery system allows the customers to pay only after they receive their products in hand, which reduces the risk of loss of money. For instance, it might happen that a customer pays beforehand through an online transfer and the seller fails to deliver the product. In such a case, the customer’s hard-earned money remains with the seller and the latter does not refund. However, with the COD option of payment, you do not have to face such risks.

Besides, the customer can also check the product and verify if everything is perfect before paying for it. In case if you find a defective, damaged product or someone else’s product, you can return them without paying for the same.

Reduced Online Payment Frauds

The COD option of payment initiated by the websites operating in India offers better security than the online mode of payments. With the COD option, you need to share any financial information with the seller such as debit card or bank account details. Hence, COD emerged as one of the most popular and preferred modes of payment, especially among Indian customers.

Zero Dependency on Payment Cards

With cash on delivery, people do not have to depend on debit and credit cards. Zero dependencies on payment cards proved useful in rural and suburban areas, as most of the people in these areas do not use the cards. When the delivery arrives at the door of the customer, he or she receives the product, checks it, and makes the payment. The COD method helps convenient and straightforward completion of the transaction.


Today, several online companies are popping up. COD option proved great to remain at the top of the competitive market. It is simply life and death for many small businesses.

Amazing Market Strategy

Today, most online sellers are aware that Indians have an extreme preference for cash on delivery. Hence, they are using the preference of the customer in capturing the Indian market. Statistics show that online stores providing COD drive more customers than others.

Gaining Trust

Following the current trends, Indians have more trust in those e-commerce companies offering cash on delivery. Besides, the online sellers also get a chance to impress their customers and achieve their trust in return, which helps the sellers in building a better relationship with their customers.

Closing Thoughts

Although the importance of offering cash on delivery might help in improving the overall online shopping experience, yet COD reduces the risks of online thefts that might occur during a careless online transaction. However, we advise you to read the terms and conditions of your preferred website, as some stores charge a fee for COD purchases. You can buy products from, We offer Cash On Delivery in India. Happy Shopping!

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