Magento 2 Cash on Delivery: Key Features and Top Providers

• What is Magento 2 Cash on Delivery?

• Key Features of Cash on Delivery for Magento 2

• Popular Extensions for Magento 2 Cash on Delivery

• Alternatives to Cash on Delivery in Magento 2 for Accepting Offline Payments

• Best Practices for Managing Magento 2 Cash-on-Delivery

• FAQs

• Summary

What is Magento 2 Cash on Delivery?

Magento 2 Cash-on-Delivery (COD) is a payment method where customers pay for their order at the time of delivery instead of during checkout.

COD is ideal for regions where online payments are less common. It is also ideal where customers prefer to inspect goods before payment.

Magento offers a built-in COD option, which is easy to configure from the admin panel. Store admins can limit its availability by region and even add extra fees for COD orders.

The offline payment type enhances customer trust. It caters to markets that rely on cash transactions rather than digital payments.

For example, a store selling electronics in regions where customers are hesitant about paying online can enable COD.

Key Features of Cash on Delivery for Magento 2

1. Simple Setup

• Magento provides a built-in Cash on Delivery payment type. It can be quickly enabled and configured in the admin dashboard.

• Store admins don’t need to integrate third-party solutions or use complex coding to set it up.

• It can be easily activated without technical knowledge.

2. Regional Control

• Store admins are able to control where Cash on Delivery is available.

• They can limit the COD option to specific:

  1. Countries

  2. Regions

  3. Certain shipping methods

• For example, COD can be enabled only for local deliveries. It ensures that it is only offered in areas where it makes sense. It helps avoid potential logistical challenges in other regions.

3. Custom Fees

• Magento 2 allows store admins to charge additional fees for COD orders to cover extra operational costs.

• The feature can be customized to apply a fixed fee or a percentage of the order total.

• For instance, if handling COD incurs higher costs, a store enabler can charge a fee. It compensates for the additional effort involved in processing the payment upon delivery.

4. Offline Payment Method

• Cash on Delivery is considered an offline payment type. No online transaction is processed at the time of purchase.

• The payment is collected upon the physical delivery of the goods.

• It is particularly useful for customers who prefer not to use digital payment types. It is also useful for those who do not have access to online banking or credit card facilities.

5. Trust Building

• Offering COD can help build trust with customers. It is especially those who are hesitant to pay upfront for products they haven’t physically received.

• The payment type provides reassurance that they can inspect the product upon delivery. It is done before completing the transaction.

• It is particularly effective in markets where online fraud is a concern or where customers are unfamiliar with eCommerce.

6. Order Management

• Magento smoothly integrates Cash on Delivery with its powerful order management system.

• COD orders are treated like any other order in the system. It allows store owners to track, process, and manage these transactions easily.

• It also ensures a smooth workflow for shipping and invoicing. It also helps maintain consistency with other payment types.

Popular Extensions for Magento 2 Cash on Delivery

1. Cash on Delivery for Magento 2 - Amasty

Amasty’s cash-on-delivery extension turns potential customers into regulars. The module lets customers make payments to a shipping carrier when receiving the goods. It is compatible with Magento 2.3.7, 2.4.2 - 2.4.6.

Key Features:

• Charge a fee for using cash on delivery as a payment type.

• Restrict cash on delivery by zip code.

• Link cash on delivery to your shipping methods.

• Customize the cash on delivery fee label displayed in the order summary block.

• Customers can check whether their location is eligible for COD.

• Gives additional flexibility.

Price:

• Magento Community Edition: $99 (12 months)

• Magento Enterprise Edition: $399 (12 months)

• Magento Cloud Edition: $699 (12 months)

2. Magento 2 Cash-on-Delivery Verification Extension - Magecomp

Magecomp’s cash-on-delivery verification extension helps store admins avoid bogus & fake orders. This is done by verifying customers’ mobile numbers when they prefer cash-on-delivery payment types. It is compatible with Magento 2.2.x - 2.4.7.

Key Features:

• Set a custom label for cash on the delivery verification field on the front.

• 3 Integrated SMS gateway APIs to send OTP confirmation messages.

• Set custom OTP length.

• Display an alert message when customers try placing an order without verification.

• Resend OTP to customers.

• Option to test SMS API functionality.

• Show/Hide the country flag with the mobile number input field.

• Phone number validation.

• Work with guest checkout to verify billing number.

• REST API Available / GraphQL API Available.

• Compatible with Hyvä React Checkout.

Price:

• Magento Community Edition: $99 (12 months)

• Magento Commerce Edition: $208 (12 months)

3. Magento 2 Cash on Delivery Extra Fee - Landofcoder

Landofcoder’s cash-on delivery allows customers to check the availability of COD & extra fees via Zip Code. Customers are able to make payments for the products when they receive them. The extension also assists Magento store admins with the management of COD in their stores. It is compatible with Magento 2.0.x, 2.1.x, 2.2.x, 2.3.x, 2.4.x.

Key Features:

• Specify products unavailable for cod

• Track cod payment method from ‘my orders’ featured

• Enable cash on delivery for products in seconds

• Set the cod extra fee label on the checkout page

• Set cod rates flexibly in different types

• Upload/export price rules csv file conveniently

• Notify cod availability by proper message

• Check orders applied with cod

• Manage cod rates in a smart way

Price: $89 (12 months)

4. Magento 2 Cash-On-Delivery Marketplace Add-on - Webkul

Webkul’s cash-on-delivery marketplace add-on allows the seller to add cash-on-delivery to their product. The extension enables sellers to manage the order and provide the commission to the admin from their end.

Key Features:

• Buyers can make their purchases using the COD payment gateway.

• Admin can add Cash On Delivery description and label.

• The admin and seller can both add their COD rates.

• Sellers can add additional information like VAT/tax details.

• Calculate COD charges as fixed or percentage-wise rates.

• Sellers have the facility to create invoices, shipments, and credit memos.

• The seller can pay the admin commission.

Price:

• Magento Open Source Edition: $298 (12 months)

• Magento Adobe Commerce Edition: $597 (12 months)

5. Magento 2 Cash-On-Delivery Pro (Multi-COD) - Tigren

Tigren’s cash-on-delivery (Multi-COD) extension enables store admins to handle some common issues of the traditional COD. The module enables you to offer your customers six different COD options instead of only one COD using Magento default.

Key Features:

• Create multi-COD based on delivery time, extra charge, and direct payment type.

• Set conditions for each COD option

• Indirect sale enhancement

Price: $99 (12 months)

Alternatives to Cash on Delivery in Magento 2 for Accepting Offline Payments

1. Bank Transfer (Direct Transfer)

Customers can make payments by transferring funds directly to the store's bank account.

Key Features:

• Store admins can provide bank details during checkout.

• Customers complete the transfer using their banking platform.

• Orders remain pending until the payment is confirmed manually.

It is ideal for businesses dealing with large or bulk orders. It is where bank transfers are more secure.

2. Check/Money Order

Customers can pay using a mailed check or money order.

Key Features:

• Store admins provide mailing instructions for checks/money orders.

• Orders remain pending until the check is received and cleared.

It is ideal for companies with traditional payment preferences. They prefer handling physical payments or customers who avoid online payments.

3. Pay on Pickup (In-store Payment)

Customers place an order online and pay when picking up the goods in-store.

Key Features:

• It is useful for businesses with physical store locations.

• Customers complete their payments using cash or card.

It is ideal for hybrid businesses offering both eCommerce and in-store services.

4. Invoice Payment

Customers receive an invoice and make payment after receiving the products.

Key Features:

• Store owners can issue invoices to trusted customers.

• Typically used in B2B transactions where payments are processed after delivery.

It is ideal for B2B eCommerce stores or businesses with established client relationships. These offer post-delivery payments.

5. Purchase Order (PO)

Customers provide a purchase order number at checkout. They make payment later as per the terms of the PO agreement.

Key Features:

• Primarily used for B2B transactions.

• Payment terms can be set for 30, 60, or 90 days after the order is placed.

It is ideal for large enterprises or wholesalers. They prefer to make payment after the goods are delivered.

Best Practices for Managing Magento 2 Cash-on-Delivery

1. Enable COD for Specific Regions

• Cash on Delivery may not be practical or necessary for all geographic regions. It is especially required for international shipments.

• You should limit COD to regions where cash transactions are common. Shipping carriers should support COD.

• Navigate to Stores > Configuration > Sales > Payment Methods. Then, the countries allowed under Cash on Delivery will be set.

2. Set Order Value Limits

• Set minimum and maximum order value limits for COD. It helps manage risks associated with handling cash.

• It helps prevent large, high-risk orders from being processed through COD.

• You can configure these limits under Stores > Configuration > Sales > Payment Methods. Then, set the Minimum/ Maximum Order Total for COD.

3. Require Additional Order Confirmation

• CODs often have a higher risk of cancellations or refusals at delivery.

• Request order confirmation via email or phone for COD orders. The extra step can reduce the likelihood of false orders or refused shipments.

• Use a custom order confirmation extension if needed.

4. Implement a COD Fee

• Cash-on-delivery transactions often involve higher logistics and administrative costs. You can add a small handling fee for COD orders.

• Navigate to Stores > Configuration > Sales > Payment Methods. Then, configure the Additional Fee option under the COD settings.

5. Monitor and Limit COD Fraud

• COD can be prone to fraudulent orders or non-serious customers.

• Use fraud detection tools to screen orders before shipping.

• Consider limiting the number of COD orders per customer or based on their order history.

6. Automate COD Order Statuses

• Simplify your workflow by setting up automated status changes for COD orders.

• After an order is placed with COD, automatically assign it a specific status like Pending COD Payment.

• Once payment is received, update the status to Processing or Complete.

• The automation can be set up through custom Magento rules or extensions.

7. Clearly Communicate COD Terms to Customers

• Be transparent about the conditions of COD payment:

• Display COD fees, if applicable, prominently at checkout.

• Clarify that COD is available only for specific regions or for orders under a certain value.

• Use Magento’s built-in content blocks or custom messaging to display this information on the checkout page.

8. Prepare for Potential Returns and Refunds

• COD orders may have a higher return rate compared to prepaid orders.

• Establish a clear return and refund policy that outlines how COD refunds are handled (e.g., bank transfers or store credits).

• Automate returns and refunds with Magento's built-in RMA (Return Merchandise Authorization) feature. You can integrate it with third-party return management extensions.

FAQs

1. How can I configure the Cash on Delivery option in Magento 2?

Navigate to Stores > Configuration > Sales > Payment. Enable the COD option and set the allowed regions. Then, additional settings like minimum order value or applicable shipping methods can be set.

2. Is there a fee for the Cash on Delivery method in Magento 2?

Magento 2 allows you to add a fee for the Cash on Delivery payment method to cover extra operational costs. You can set a fixed amount or a percentage of the total order under the COD configuration settings.

3. How do I control Cash on Delivery availability for my store?

You can control Cash-on-delivery payment availability by limiting it to specific countries, regions, or shipping methods. It ensures COD is only offered where it makes logistical and business sense for your Magento 2 store.

4. How are Cash on Delivery orders handled in Magento 2?

Cash on Delivery orders in Magento 2 are processed like any other order. Store admins can track, manage, and update COD orders through the order management system. It ensures a smooth workflow for shipping and invoicing.

Summary

Magento 2 Cash on Delivery (COD) enhances customer trust by allowing them to inspect goods before payment. The article uncovers several key features of COD, including:

• Enable COD without technical expertise via the admin panel.

• Restrict COD to specific regions or shipping methods.

• Add extra charges to cover operational costs.

• Track and manage COD orders smoothly.

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