Cash on delivery: info and costs of Italian carriers

If you want to offer your customers the option to pay for shipments by cash on delivery in 2023, but aren't sure how to do it or with which carrier, you're on the right article.

Today we'll explain everything you need to know about cash on delivery, the risks for your e-commerce, the advantages, and the rates for this shipping and payment service that is still very much in demand in Italy.

We'll also look at all the news to keep in mind this year, such as the change to the maximum amount payable in cash, which since 1 January 2023 has gone from €1,999.99 to €3,999.99.

Enjoy the read!

TABLE OF CONTENTS:

• What does cash on delivery mean and how does it work?

• Risks and problems of cash on delivery

• Shipping cash on delivery: when is it worth it?

  • Additional information on payment methods

  • Electronic duty stamp (contrassegno telematico)

• Cash-on-delivery shipments: which is the cheapest?

  • Cash-on-delivery shipments with Poste Italiane

  • Cash-on-delivery shipments with TNT

  • Cash-on-delivery shipments with BRT (Bartolini)

  • Cash-on-delivery shipments with GLS

  • Cash-on-delivery shipments with DHL

  • Cash-on-delivery shipments with UPS

• The best solution is always multi-carrier

What does cash on delivery mean and how does it work

When you make a cash-on-delivery shipment, your customers have the option to complete payment at the moment they receive their purchase. Payment can be made in cash, by bank cheque, or by card, directly to the carrier. So it won't be made on your e-commerce platform at the time of purchase.

Afterwards, it's up to the carrier to transfer the money to your company's account.

Despite the rise of digital payment methods and their security and convenience for the user, cash on delivery remains a very common payment method in Italy, especially in the southern regions.

If you want to offer this option, remember to specify it at checkout.

Why cash on delivery isn't worth it

Before deciding, though, it's a good idea to know the risks, costs, and advantages of this delivery method.

This shipping method presents some risks for anyone running an e-commerce, as well as some higher costs compared to other shipments.

First of all, shipping cash on delivery is more expensive, because you'll have to pay extra for the carrier's payment-collection service. But that's not all.

Then there's a higher risk of a return.

Since they don't have to pay upfront for the purchase, it's not uncommon for some potential customers to get carried away and buy a product without thinking too much about it, only to regret it later and refuse the parcel when the carrier arrives to deliver it.

The goods will be returned to you, of course, but you won't be exempt from paying the shipping cost, pointlessly.

The same problem can also arise if the customer is unreachable. Most carriers make three delivery attempts before returning the parcel to the sender, but if all three fail, once again you'll see the goods and the shipping bill come back to you.

Finally, even if it's certainly the lesser evil, if delivery and payment go through successfully, you'll receive the money you're owed several days (if not weeks) later than with any other electronic payment system.

Even though they pay on receipt, customers can't open the parcel and check the goods before settling up with the carrier. If the goods don't match the description, having paid in cash, getting a refund will be much more complicated, if not impossible.

So when is cash on delivery worth it?

Despite the evidence, many people are still convinced that cash on delivery is the safest purchase option in the world.

Including it among the available shipping options could open your e-commerce to that whole segment of customers who aren't yet familiar with online payments.

Setting aside indirect marketing and false perceptions, there's at least one valid reason to enable cash on delivery: reaching all those potential customers who don't have access to a credit card or a digital current account.

Additional information on payment methods

As mentioned, the most used payment methods for cash on delivery are cash and cheque, while some carriers are also equipped for card purchases.

The maximum amount allowed for each payment depends on the carrier; you can get an idea of the figures by consulting the comparison table in the next section.

In Italy, by law, since 1 January 2023 it's not possible to make cash payments over €4,999.99.

Electronic duty stamp (contrassegno telematico)

A brief aside on the "contrassegno telematico" is in order, to avoid confusion.

The electronic duty stamp has nothing to do with e-commerce.

It's actually a duty stamp to buy at any tobacconist and to attach to a passport application.

The only reason we mention it is to dispel any doubts.

Let's move on and see which carriers are worth turning to.

Cash-on-delivery shipments: which is the cheapest?

Unfortunately, there's no single answer to this question.

Most carriers reserve the cash-on-delivery payment option only for customers subscribed to their services, so rates vary depending on the type of contract signed.

On top of this, the cheapest cash-on-delivery rate in the world isn't much use if the carrier that offers it doesn't handle the type of shipments you need or has prices that are too high for the type of goods you deal in.

To get past all these variables and start narrowing things down, you can use the comparison table below, in which we've gathered some critical data that might help you understand which partners are the most interesting for your needs.

By clicking on each carrier's name you can go straight to the dedicated section within the article.

Cash-on-delivery shipments with Poste Italiane

Compared to its private counterparts, the national postal service doesn't stand out for delivery speed and reliability, but it could be an alternative to consider for occasional shipments and ones within 20 kg.

In that weight range Poste Italiane has a fairly competitive offering and is one of the few services that lets you ship cash on delivery without needing to be a subscribed customer.

Another aspect worth considering is the reach of the network, with 12,800 post offices across the country and the ability to use them to arrange collection by the customer.

Poste Italiane's maximum payment cap varies by service; let's look at it below.

Cash payment:

• Poste Delivery → €1,999.99

• Crono → €999.00

• Extralarge → €4,999.00

Payment by bank or postal cheque:

• Poste Delivery → €2,999.99

• Crono → €2,582.24

Costs of cash-on-delivery shipping with Poste Italiane

Cash on delivery can be selected as an add-on service to attach to a shipment, provided the value of the goods doesn't exceed €3,000.

The service costs depend on how it's handled.

• If the money is credited via a postal current account, the service cost is €2.27. Remember, though, that crediting by postal slip isn't possible on a private current account. A dedicated business current account is required.

• If crediting is done by postal cheque, the service cost is €2.57 (€0.77 to pay at the time of shipping + €1.81 deducted from the endorsed cheque).

• If payment is made by postal money order, the service cost is €6.77 (€0.77 for the service and €6 for the money-order cost).

In addition, if collection of the parcel at the post office is expressly requested, the recipient will have to pay an extra €1.50 at the time of collection.

Of course, you can have the parcel delivered directly to the customer's home, but the carrier can't collect cash amounts over €258.23 directly.

Having the option of collection at post offices guarantees greater flexibility for those customers who can't be home for delivery and don't have a concierge service.

Cash-on-delivery shipments with TNT

Within Italy, TNT has limits on coverage and reliability compared to local competitors, but the cash-on-delivery service it offers is the only alternative to Poste Italiane's that doesn't require signing a subscription contract with the carrier.

The whole process happens online and it can be a good solution for a growing e-commerce that doesn't yet have a defined logistics plan but wants to access this kind of service only occasionally.

Costs of cash-on-delivery shipping with TNT

The payment methods TNT allows are cash and bank, postal, or cashier's cheque.

The maximum cap corresponds to the current legal maximum of €4,999.99.

Being tied to cash only is certainly a limitation, but it has the advantage of guaranteeing you fast receipt of the money (which should happen within 4 working days of delivery).

The commission fees due for TNT's services are calculated as follows:

• 2% (plus VAT) of the total amount collected

• Minimum commission €10.00

Cash-on-delivery shipments with BRT (Bartolini)

BRT is one of the main Italian carriers and is often chosen for its affordable prices and delivery speed. Another big advantage of BRT is that it can handle parcels of any type and size.

Like all business-oriented carriers, BRT too reserves the cash-on-delivery service for its subscribers, so rates depend on the type of contract signed. However, even though we don't have fixed reference rates, we can see which payment methods are allowed, the amount limits, and the reimbursement times.

Costs of cash-on-delivery shipping with BRT (Bartolini)

BRT lets you pay by cash or cheque. The amount to be collected must be indicated in figures and words on the transport document, and the same must be done for the collection method.

Cash

BRT's cash collection limit is €1,999.99.

BRT reimburses cash-on-delivery amounts settled in cash daily (by bank transfer), or every fifteen days (if by draft cheque sent through Poste Italiane's priority service).

Cheque

Up to €3,000 you can have the cashier's or bank cheque made out directly to you. Over €3,000 the carrier accepts only cashier's cheques made out to BRT S.p.a.

In Italy there are no caps for paying cash on delivery by cheque; for abroad the limit is set at €10,000 per shipment.

Collected cheques are returned within 7 working days of delivery.

Cash-on-delivery shipments with GLS

GLS can be the best choice for international shipments across Europe, so it could be a good choice if you also sell abroad.

As for domestic performance, however, GLS isn't among the carriers with the widest reach, but at the same price it manages to guarantee greater reliability than its competition.

This means the service cost is recalculated each time, tailored to the customer, and that there are no general reference rates.

Let's see what types of payment they allow.

Costs of cash-on-delivery shipping with GLS

GLS lets you make cash-on-delivery payments through the COD (Cash On Delivery) service, which can be applied to all international and domestic shipments.

The accepted payment methods are:

Cash

GLS doesn't specify any cash collection limit (as other carriers do), but you must always keep in mind that in Italy the maximum limit for cash payment is €4,999.99 (since 1 January 2023).

Cheque

GLS accepts bank, cashier's, or postal cheques. Here too GLS doesn't specify particular threshold amounts, so the only references we have are the legal ones.

The COD service can be booked directly when creating the shipment through the automatic labeling systems. This will let you receive the payment money without needing to fill out any other documentation.

You'll need to indicate the amount to be collected on the transport document, both in words and figures.

GLS has a reputation for settling due payments punctually and quickly, but the payment frequency is another of the variables to be defined at the contract stage.

Cash-on-delivery shipments with DHL

DHL is one of the world's logistics leaders and is an ideal partner for e-commerce stores that ship worldwide and want to offer their customers an exceptional service.

Unfortunately, DHL too reserves cash on delivery only for subscribed customers, so rates vary from customer to customer.

These are the things we can know:

Costs of cash-on-delivery shipping with DHL

DHL lets you pay in three different ways:

• Cash

• Cheque - the bank or cashier's cheque must be made out to DHL and can't exceed €2,000.

• Card - thanks to the card reader in every vehicle, DHL allows cash-on-delivery payment by card. This is an excellent option because it further simplifies payment, guaranteeing a better experience for customers and minimizing the chance of errors and problems.

As for transferring the amounts received, DHL credits its customers within 15 days of collection.

Cash-on-delivery shipments with UPS

UPS is a worldwide shipping giant that in Italy can count on a solid distribution network and very flexible services that can be assembled to meet the most varied needs.

Like most large e-commerce carriers, UPS too requires signing a business contract to determine what kind of rates your e-commerce store can access. Let's move on to the payment options available to us.

Costs of cash-on-delivery shipping with UPS

UPS mainly accepts cash and cheques, but they're open to negotiating other payment methods (such as bank transfer).

Let's see what the payment limits are:

Cash

The maximum amount set per recipient per day is €1,999.99.

Cheque

UPS accepts personal or business cheques, and the limit set per recipient per day is the equivalent of USD 50,000 in local currency.

Other payment methods

As for the other payment methods available, the possibilities and amounts vary based on sales volumes. Each business will have to negotiate its own.

The best solution is always multi-carrier

Each carrier has its strengths and its limits, and there's no universally cheaper option.

What's more, in a market shaped by Amazon and the big players, flexibility in the delivery offering has become, to all intents and purposes, a key factor for success and for increasing an e-commerce's sales.

So the best option is to rely on a multi-carrier solution.

How? Try Sendcloud!

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Request a free 15-minute demo and let us walk you through all the advantages Sendcloud offers.

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You'll save a lot of time and money and increase your e-commerce's efficiency across every department, from logistics to customer care. Embrace innovation today!