Cash on delivery on Shopify in the UAE without the fake orders

Ask almost any UAE e-commerce founder about cash on delivery and you will hear two things in the same breath: customers still ask for it, and it causes a lot of trouble. Orders get placed on impulse and refused at the door. Phone numbers turn out to be wrong. Couriers make three attempts and send the parcel back. Meanwhile your stock sits in a van for a week and your cash sits with the courier for longer.

Turning COD off is rarely the answer. It still reassures first-time buyers, and switching it off often lowers conversion more than it saves on returns. A better approach is to run COD as a controlled channel. You decide who can use it, confirm every order before it ships, measure what it really costs, and give buyers good reasons to prepay. This guide covers how to do that on Shopify, step by step.

Why COD still matters in the UAE and wider GCC

Card and wallet payments have grown fast across the Gulf, and many UAE shoppers now pay by card, Apple Pay or buy now, pay later as a matter of habit. COD has not disappeared, though, and it still plays a specific role:

• Trust with new brands. A shopper who has never heard of your store may not want to enter card details on an unfamiliar site. Paying on arrival removes that risk for them.
• Cross-border GCC orders. If you ship to Saudi Arabia, Kuwait, Oman, Bahrain or Qatar, expectations differ by market and by customer segment. COD can be what decides whether you get the order.
• Customers without cards or with card limits. Some customers simply prefer cash or a card payment at the door, and some would rather not use a card online at all.

Published figures on COD’s share of GCC orders vary a lot by source, method and category, so do not plan around a headline number. Use your own data. In Shopify analytics, compare conversion rates and order values for COD and prepaid orders. That tells you how much COD is actually worth to your store.

How to enable cash on delivery in Shopify

On Shopify, COD is a manual payment method. No money moves at checkout. The order is created as unpaid and you mark it as paid once the cash reaches you. According to Shopify’s help centre on manual payment methods, the setup is:

1. In your Shopify admin, go to Settings, then Payments.
2. Under the manual payment methods options, choose Cash on Delivery (COD).
3. Fill in Additional details (shown next to the method at checkout) and Payment instructions (shown after the order is placed).
4. Activate the method and place a test order.

Some practical points:

• Use the instructions field to set expectations. For example: “Please keep the exact amount ready in AED. Our courier may also accept card on delivery.” Only say card is accepted if your courier actually offers it.
• COD orders appear as payment pending in the Orders list. Your team, or an integration with your courier, needs to mark them as paid once the money is remitted. Otherwise your reports will show revenue that you have not received.
• Shopify says it doesn’t charge third-party transaction fees on manual payments. Your courier’s COD handling fee still applies, and that is usually the larger cost.

Should you charge a COD fee?

Shopify doesn’t have a built-in setting that adds a surcharge only when the customer picks COD. Merchants usually take one of three routes:

• A COD fee app. Several apps add a fee when COD is selected. Check how the fee is displayed at checkout. Customers should see the final total before they place the order, not discover it at the door.
• Building the cost into shipping. Some stores raise the delivery charge slightly and offer free or cheaper shipping on prepaid orders. This is simpler to run, but less precise.
• No fee, with a prepaid incentive. Rather than penalising COD, reward prepayment. We cover this below.

A small, clearly shown COD fee can filter out the least serious orders. A large or hidden one tends to backfire, either as abandoned checkouts or as refusals at the door. Whatever you choose, make sure the fee and any VAT on it are handled the way your accountant expects.

Control who can see COD

You don’t have to offer COD on every order. Shopify supports payment customisation functions, which apps can use to hide, reorder or rename payment methods at checkout based on conditions such as cart total or address. Plan and regional restrictions apply. Common rules for UAE stores include:

• Hide COD above a set order value, where a refused parcel would cost you the most.
• Hide COD for destinations or emirates where your refusal rate is consistently high, or where your courier does not offer COD.
• Hide COD for pre-orders, personalised products and other items you cannot resell easily.
• Show prepaid options first, so COD is available without being the default.

Pick a small number of rules, run them for a few weeks, and check the effect on conversion and refusals before adding more.

Verify COD orders before they ship

Order confirmation does more to reduce fake and impulse orders than anything else here. The idea is simple: no COD order goes to the courier until the customer has confirmed it.

The Shopify App Store has a category of COD order verification apps. They usually work in one of these ways:

• WhatsApp confirmation. After checkout, the customer gets a WhatsApp message with an order summary and buttons to confirm or cancel. The app then tags the order in Shopify.
• SMS one-time passcode. The customer enters a code sent to their phone, either before the order is placed or straight after. This also catches mistyped numbers.
• Automated or manual calls. Some teams still phone every COD order, which works at low volume but becomes hard to manage as you grow.

Whatever tool you use, set up a clear process around it:

1. Tag new COD orders as unverified and hold fulfilment.
2. Send the confirmation request straight away, while the customer still remembers buying.
3. Send one reminder after a few hours. If there is still no answer within your cut-off, cancel the order and restock the items.
4. Only confirmed orders are released to the courier.

WhatsApp is widely used in the UAE, so it tends to feel natural to customers. If you message customers on WhatsApp Business, follow its messaging policies and keep the wording transactional.

Understand courier COD remittance

With COD, the courier collects the money and pays it to you later, usually on a regular cycle and after deducting its fees. Before you choose a courier, or when you review your current one, check:

• Remittance cycle. How many days pass between delivery and the money reaching your bank account?
• COD handling fee. Is it a flat fee per order or a percentage of the amount collected? Is there a minimum?
• Failed delivery and return charges. What do you pay when a customer refuses the parcel, and how many delivery attempts are included?
• Reporting. Can you get a remittance report that maps payments to individual Shopify order numbers? Without one, reconciliation becomes a monthly spreadsheet exercise.

Cash held by a courier is still working capital you can’t spend on stock or ads. A long remittance cycle can strain cash flow, especially when you are growing fast.

Encourage COD buyers to prepay

The aim is not to force anyone onto card payments. It is to make prepaying the easier and better-value choice. Approaches that tend to work:

• A small prepaid discount or perk. A modest discount, free shipping or a free sample for prepaid orders. Show it clearly on the product page, in the cart and at checkout.
• Buy now, pay later. Many COD buyers want to avoid paying everything upfront, or paying a brand they don’t know yet. Instalment providers can address both concerns. Tabby, for example, has an official Tabby app on the Shopify App Store. Other regional BNPL providers also offer Shopify integrations, so compare merchant fees and settlement terms.
• Express wallets. Apple Pay and Google Pay remove most of the effort of paying by card on mobile.
• Convert at confirmation. When you send the WhatsApp confirmation, include a payment link with a small incentive for paying now. Some customers will switch.
• Trust signals. Clear return policies, real reviews, a UAE contact number and visible delivery timelines reduce the anxiety that makes customers choose COD in the first place.

Measure RTO and failed delivery rates

You can’t manage COD properly if you only track sales. Add these to your weekly reporting:

• COD share of orders, overall and by campaign or traffic source.
• Verification rate: the percentage of COD orders confirmed by customers.
• RTO rate (return to origin): shipped COD orders that came back undelivered, as a percentage of shipped COD orders.
• Failed attempt reasons from your courier, such as refused, unreachable, wrong address or rescheduled.
• Net revenue per COD order after courier COD fees, return shipping, and damaged or unsellable stock.
• Days to cash: the average time from shipping to remittance.

Break RTO down by product, emirate or country, and ad campaign. High refusal rates often come from one campaign that attracts curious clickers rather than buyers. Compare net revenue per order for COD and prepaid orders. The gap shows how much a prepaid incentive can be worth before it stops paying for itself.

Getting help with COD on your Shopify store

None of this needs a custom build to get started. Most stores can enable COD properly, add verification and set up a prepaid incentive in a few days. If you want help with the setup, the checkout rules or the reporting, our conversion optimisation service covers it. You can also learn more about our Shopify agency in Dubai. We are happy to review your current COD setup first and tell you what we would change.