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What is Cash on Delivery and why is it popular in the Philippines?

Online shopping has grown immensely in the Philippines. According to a report by Visa, more Filipinos now go on digital commerce platforms — with close to 9 in 10 people increasing their online shopping activities in the past year. And in all these transactions, one thing remains true: cash is still king.

Despite the rise of a range of alternative payment methods, Cash on Delivery (CoD) is still one of the preferred payment options in the Philippines. This stems mainly from the fact that many Filipinos remain unbanked.

So, what exactly is the meaning of Cash on Delivery?

Cash on Delivery is a popular method of payment in the Philippines for online purchases. Meaning, through Cash on Delivery, the buyer doesn’t have to pay the seller until the logistics company delivers the product.

It’s also quite straightforward to do a CoD transaction. Once the buyer completes an order on the merchant’s site, they just have to provide their name and delivery address. If they choose the “Cash on Delivery” option, the buyer won’t have to pay yet upon check out. Once their delivery comes, the buyer can then check the product, pay, and complete the transaction.  When the seller receives the payment, they can close the order and mark it as a completed transaction.

Shoppers still choose CoD despite the rise of digital payment options 

Cash on Delivery in the Philippines has gained much traction over time as it’s still hard to build trust and convince customers to use digital payment options. Scams and fraudulent schemes are rampant in the country, and shoppers want to make sure that they don’t have to pay until they receive their products. This way, there is no risk of losing money.  

This option also draws a distinction to the usual online shopping process overseas which requires customers to pay, via debit or credit card or other modes of digital payment, before the merchant ships an item out.

Because CoD payments do not depend on credit or debit cards, people in areas where card and digital payments are not possible yet can still make online purchases. Also, customers won’t have to worry about security, as they don’t have to divulge financial information to the seller.

I’m an online seller, what’s in it for me?

Now that you know the meaning of CoD, it’s easy to see why it’s a popular payment option in the country. If you are an international merchant trying to expand your online business to the Philippines, think about this: How many people have visited your site and abandoned items in their cart? Filipinos might get dissuaded from completing this transaction because first, they don’t want to pay at that exact moment, and second, they simply don’t wan tto deal with online payments. That’s why offering CoD is a must.

Also, CoD is a good way to build your brand. With online shopping growing year-on-year in the Philippines, offering CoD increases the likelihood of Filipinos buying from your store. Maybe they’ll even rate your business five stars because of that, which is a good way to build your brand!

Convinced now? Easily integrate the Cash on Delivery payment option with Payo, your partner in online selling success!

Let Payo help you with CoD Integration!

Payo is an E-commerce enabler that provides local and international online sellers with innovative tech solutions to make online selling simple.

We take care of CoD Integration, allowing you to give your customers more flexible payment options. This can be done through Shopify or by manual tagging on the merchant dashboard we provide. Once it’s been integrated, your customers will instantly see a CoD option on your selling platform. We will also take charge of collecting your CoD payments, and remitting your earnings upon delivery.

So, what are you waiting for? Offer Cash on Delivery and expand your Philippine customer base with Payo! Sign up today or send us a message at [email protected] to learn more.