Cash on Delivery in India: How to Offer COD Without Losing Money to Fake Orders
COD still drives the majority of orders for Indian D2C sellers — but it's also where fake orders and RTO losses hide. Here's how to offer it safely.
In this post · 4 sections
Cash on delivery still accounts for a huge share of online orders in India — especially outside the metros, where trust in "pay before you see the product" is still building. Turning COD off entirely can cost you real sales. But leaving it wide open is how sellers end up with a warehouse of returned parcels and a courier bill nobody budgeted for.
Here's how to keep COD on without letting it quietly eat your margins.
Why COD isn't optional for most Indian sellers
Card and UPI penetration keeps growing, but a large share of your potential customers — first-time online buyers, tier 2/3 cities, older shoppers — will simply not check out if COD isn't available. For many D2C brands, disabling COD isn't a "clean" decision, it's a silent 20-40% cut in conversion.
The real cost hiding inside COD
The problem was never COD itself — it's fake and low-intent orders. A customer places an order on impulse, doesn't answer the delivery call, and the parcel goes back (RTO). You still pay both-way shipping, repackaging, and the opportunity cost of stock that was tied up in transit for days.
5 ways to keep COD without the losses
- Confirm orders that look risky. A quick automated WhatsApp or SMS confirmation before dispatch filters out a large share of fake or impulsive orders.
- Ask for a small advance on COD orders. Even a ₹49-₹99 UPI token amount deducted from the final price dramatically cuts no-shows, because the customer now has something at stake.
- Cap COD order value for first-time customers. Let new customers pay COD up to a limit; above that, nudge them toward prepaid with a small discount.
- Watch your repeat offenders. A customer with two or more RTOs in the past is a pattern, not bad luck — flag those numbers before you ship again.
- Make prepaid the easier choice. If UPI checkout is one tap and COD requires an extra step or two, more customers will default to paying upfront — without you removing COD as an option.
How this works on Selzix
Selzix stores support Razorpay, direct UPI, and cash on delivery side by side — so you're not forced into an all-or-nothing choice. You can see which payment method each customer used, spot repeat COD-only buyers in your dashboard, and adjust your risk tolerance as your order volume grows.
COD got you your first customers. The goal isn't to remove it — it's to stop it from quietly funding your returns pile.
Ready to run payments and COD from one dashboard? Start your free 14-day trial — no card required.