UPS COD Fee 2026: $22.50 Per Package — Why Most Shippers Drop It

2026 UPS rate: The COD (Collect on Delivery) fee is $22.50 per package, handled through UPS Capital. This charge applies when UPS collects payment from the recipient at delivery and remits it back to the shipper.

Quick answer: A UPS COD fee of $22.50 is charged each time UPS collects payment from the recipient on your behalf. The COD payment due from the recipient must be a cashier's check, money order, or certified check — personal checks are not accepted. Most shippers find cheaper alternatives.

Most COD overcharges stem from automated shipping rules that default to COD when simpler payment collection would work. A UPS invoice audit service can identify these patterns and recover credits.

If you're evaluating UPS surcharges more broadly, see how COD compares to other accessorial charges like the UPS Direct Signature Fee or UPS Declared Value Charge.

How the UPS COD fee works, what it costs in 2026, how COD payment collection operates, and the three alternatives most shippers use instead.

What Does COD Mean in Shipping?

COD stands for Collect on Delivery (also called Cash on Delivery). When a shipper selects COD service, UPS collects the COD amount from the recipient before releasing the package. The collected funds are then remitted to the shipper, minus the COD fee.

The UPS COD service is administered through UPS Capital, UPS's financial services arm. This matters because COD isn't just a surcharge — it's a financial transaction service with its own processing timeline, payment restrictions, and operational limitations.

How Much Does the UPS COD Fee Cost in 2026?

The UPS COD fee is $22.50 per package in 2026. This is a flat fee that applies regardless of the COD amount being collected. Whether you're collecting $50 or $5,000, the fee is the same.

COD Fee History

• 2023: $19.00 per package
• 2024: $19.50 per package
• 2025: $21.00 per package
• 2026: $22.50 per package

How UPS COD Payment Works

When you ship with UPS COD, the process works like this:

1. You create the shipment with COD service selected and specify the COD amount to collect.
2. UPS delivers the package and collects the COD payment from the recipient at the door.
3. Accepted COD payment methods include cashier's check, certified check, or money order — all payable to the shipper.
4. UPS remits the collected COD amount to you within 7–10 business days after delivery.

The COD amount — the dollar value UPS collects — is set by the shipper at shipment creation. UPS's maximum COD amount is $50,000 per package for domestic shipments.

What Is Import COD?

Import COD applies to international shipments entering the U.S. where the importer (recipient) pays the COD amount upon delivery. Import COD fees may differ from domestic COD rates and are subject to international customs regulations. Availability depends on the origin and destination countries involved.

Does UPS Do COD?

Yes — UPS offers COD service for both Ground and Air shipments within the U.S. COD is available on UPS Ground, UPS 3 Day Select, UPS 2nd Day Air, and UPS Next Day Air services. International COD availability is more limited and varies by trade lane.

Why Most Shippers Are Dropping COD

Despite the simplicity of the concept, the UPS COD fee has become a cost most shippers can no longer justify:

• High per-package cost: At $22.50/pkg, COD adds significant expense to every transaction — especially for lower-value shipments.
• Slow fund collection: The 7–10 day remittance cycle ties up working capital compared to instant digital payment processing.
• Limited payment tracking: COD payment status isn't visible in real-time through standard UPS tracking tools.
• Recipient refusal risk: If the recipient refuses to pay, you absorb the return shipping cost plus the original COD fee.

Three Alternatives to UPS COD

1. Prepaid online payment: Collect payment before shipping via credit card, ACH, or digital wallet. Eliminates the $22.50 fee entirely and funds arrive instantly.
2. Net terms with invoicing: For B2B shipments, invoice the recipient with net-30 or net-60 terms. Lower cost than COD and builds stronger customer relationships.
3. Third-party payment platforms: Services like PayPal or Stripe process payment at the point of order for a fraction of the COD fee.

Frequently Asked Questions

What does COD fee mean on a UPS invoice?

A COD fee on your UPS invoice means UPS collected payment from the recipient on your behalf at delivery. The $22.50 charge covers UPS's service of collecting and remitting that payment back to you through UPS Capital.

What is the UPS COD payment amount?

The COD amount is the dollar value you instruct UPS to collect from the recipient — separate from the $22.50 COD fee itself. You set the COD amount when creating the shipment, up to $50,000 per package for domestic shipments.

Can I use COD with UPS Ground?

Yes. COD is available with UPS Ground, UPS 3 Day Select, UPS 2nd Day Air, and UPS Next Day Air for domestic U.S. shipments.

What forms of payment does UPS accept for COD?

UPS accepts cashier's checks, certified checks, and money orders for COD collection. Personal checks and cash are not accepted. Payment must be made payable to the shipper, not to UPS.

Related Reading

• UPS Direct Signature Fee 2026: $7.70 Per Package + When to Skip It
• What Does UPS Additional Handling – Dimension Charge Mean?
• UPS Fuel Surcharge 2026: What It Applies To & Who Pays
• UPS Peak Surcharge 2026: What It Means on Your Invoice
• UPS Address Correction Fee 2026: $21.40 Per Package + Dispute Rules

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