Cash on delivery (COD)

A payment term under which payment for the shipped goods is to be made to the carrier at time of delivery. This practice is not recommended in foreign trade because of differing methods of operation employed by carriers in different countries and because the carrier nor the consignee may have access to foreign exchange. Documents against payment (DAP) or cash against documents (CAD) are often preferred alternatives as they use the banking system, which is better equipped to process documents and convert currencies.

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