When COD is still worth offering

Cash on delivery is worth offering as long as the profit from the COD orders that get delivered is larger than the cost of the ones that come back. Often that means keeping COD on for most orders and limiting it only where refusals cluster: repeat refusers, very large carts, large first orders and products you can't resell. Turn COD off for everyone only when your own refusal rate is above your break-even rate.

Who still needs cash on delivery?

Three groups of shoppers lean on COD.

Shoppers without an account. Someone with no bank or mobile money account usually can't pay online by card. The World Bank's Global Findex survey measures the share of adults (aged 15 and over) who have an account at a bank, another financial institution or a mobile money provider:

So in 2024 about one adult in five in Saudi Arabia, one in four in Kuwait and three in ten in Oman had no account at all. Qatar has no recent figure in the dataset. Having an account doesn't always mean having a card that works online, so the share who can't pay online at checkout may be larger.

First-time buyers who don't know your store. Paying at the door means the shopper risks nothing if the parcel never arrives. For a new shop with no reviews, COD can be the reason a shopper places a first order at all.

Shoppers who don't want to type card details on an unfamiliar site. Trust signals help (see nudging shoppers from cash to card), but some shoppers will still choose cash.

COD doesn't always mean the shopper can inspect the item before paying, though. One UAE courier's published terms (Wakilni's, checked 26 October 2026) say it won't let the shopper open the parcel before signing, and if the shopper won't pay without opening it first, the parcel goes back as RTO (return to origin).

Is cash use falling?

In shops overall, yes, at least in Saudi Arabia. The Saudi Central Bank (SAMA) reported that electronic payments made up 85% of total retail payments in 2025, up from 79% in 2024. That figure covers all retail payments, not only online orders, so it doesn't tell you what share of your shoppers need COD. Your own orders do: check what share of them use COD every few months. If that share falls, limiting COD costs you fewer sales.

What does COD cost you even when the parcel is delivered?

Count these costs on every delivered COD order:

• The courier's COD fee. Quiqup's published schedule (checked 26 October 2026), for example, charges 2.5% of the value collected on cash and card payments it processes. On an AED 400 order that would be AED 10.
• Slower cash. The same schedule says COD reconciliation happens every 2 weeks and payments are made once a week, after your written confirmation.
• Cash limits. Wakilni's published UAE rate proposal caps COD at AED 2,500 per domestic shipment. Your courier may have a similar cap.
• Admin time. Shopify marks manual-payment orders, including COD, as unpaid until you mark them as paid, so someone has to match courier payouts to orders. See how to mark COD orders as paid.

Then there are the parcels that come back. Each one costs shipping, packaging, the ad spend that won the order and staff time. What one refused COD order really costs gives the full formula.

How do you decide whether COD pays for your store?

Compare two numbers from your own data:

1. Your refusal rate: COD orders that shipped and came back ÷ COD orders that shipped. The spreadsheet steps are in how to work out your COD refusal rate.
2. Your break-even refusal rate: profit per delivered order ÷ (profit per delivered order + cost per refused order).

Then match your situation to an action:

The "groups" are usually big carts, large first orders, certain cities or emirates, and a few products. Check each one with the same spreadsheet.

Why not just turn COD off for everyone?

The sales you lose are hard to see. A shopper who wanted COD and didn't find it simply leaves, so the cost never shows up as a refused parcel in your reports. Turning COD off for everyone also removes it for the shoppers who were never a problem.

A safer path is to limit COD for one risky group first, for example carts above a set amount, and compare four weeks before and after: orders in that group, the share paid online, and refusals. If orders hold up, extend the limit to the next group.

Khaleeji COD works this way: it hides COD at checkout only when a rule you switch on matches, such as a cod-refused customer tag or a cart above your limit. Everyone else still sees COD, and cards, Apple Pay and pay-later methods are never changed. For the other ways to manage COD risk, such as a COD fee, partial COD or OTP checks, see hide COD, COD fee, partial COD or OTP: which fits your store.