Tabby vs COD: Fees, Refusals and Cash Flow for GCC Stores

Tabby vs COD comes down to three numbers: what each method costs per order, how many orders fail at the door, and how fast you get your money. BNPL (Tabby, Tamara) charges the store a fee and pays out on a schedule. COD costs no fee to the shopper's wallet, but you carry refusals and wait for couriers to remit cash.

Neither Tabby nor Tamara publishes its merchant rate. So this post gives you a method and a hypothetical example, not a league table of percentages.

Tabby vs COD: how do they compare at a glance?

The two methods trade a visible fee for hidden costs. Here is the short version.

The surcharge point matters. Tabby's help centre prohibits extra fees for using Tabby, and Tamara's terms call surcharging a material breach, according to the Tabby and Tamara reviews on PaymentReview. You can't pass the fee to the shopper. It has to come out of your margin.

What do Tabby and Tamara charge a store?

Tabby's merchant terms define the fee as a percentage plus a fixed amount per transaction. They exclude UAE taxes, transfer charges and foreign-exchange fees, per PaymentReview. The rate itself isn't public.

Tamara doesn't publish its fees either. PaymentReview says so, and Blooprint's merchant guide says the fixed and variable fees are written in the Merchant Onboarding Form, which isn't public. NKM reports that Tamara can change fees on 10 days' written notice.

You will find blog posts quoting ranges. They disagree with each other, and some carry unfinished "verify" notes. We won't repeat any of them as fact.

What to do instead:

• Ask each provider for your rate in writing, including the fixed per-order part.
• Ask what is excluded (taxes, transfer charges, currency conversion).
• Ask how much notice you get if the fee changes.
• Ask what happens to a payout when a shopper returns an item.

How does cash flow differ?

BNPL pays you in a fixed weekly rhythm. COD pays you whenever your courier does.

With Tabby, the merchant is paid for the goods upfront, less a merchant discount fee, and Tabby collects the instalments from the shopper, according to PFGrowth. So you don't wait for the shopper's second or third instalment. NKM's comparison says both providers offer a fixed weekly payout, with Tabby paying on working Mondays and Tamara on Tuesdays. Confirm the day and the cut-off in your own agreement.

COD is different. The courier collects cash at the door, then remits to you on its own schedule. That schedule depends on your courier contract. It can differ by courier and by city, and a Dubai route may remit on a different cycle from a Riyadh or Jeddah route. If you use three couriers, you have three remittance cycles and three statements to match against your orders.

A common COD problem: a courier's weekly statement shows AED 18,400 collected, your system expects AED 19,100, and nobody can say which 4 orders are missing. That reconciliation takes hours, and it repeats every week.

What happens with refused COD orders?

A refused COD parcel costs you the outbound trip, the return trip and the time the stock sits out of your inventory. With BNPL, the shopper has already committed at checkout, so the "I changed my mind at the door" refusal mostly disappears. Returns can still happen under your normal return policy.

We have no verified refusal rate for the UAE or Saudi Arabia, and we won't invent one. Your own data is the only number that counts. Pull the last 90 days and calculate:

• Refused or undelivered COD orders divided by total COD orders dispatched.
• The same figure split by courier, by city and by order value.
• The cost of each failed attempt: courier fees both ways, plus packaging if the parcel can't be resold as new.

Patterns usually show up fast. Say high-value orders to one area get refused more than small orders elsewhere. That's a signal to push BNPL or prepayment for those baskets.

Worked example: 100 orders at AED 400 (hypothetical)

This example uses placeholder numbers, clearly not real rates. Replace them with yours.

Say a Dubai store gets 100 orders of AED 400 each, AED 40,000 in total.

COD only (hypothetical):

• 12 orders are refused at the door. 88 are delivered.
• Cash collected: 88 × AED 400 = AED 35,200.
• Failed delivery cost: 12 × AED 18 (both ways) = AED 216.
• Courier COD handling: 88 × AED 5 = AED 440.
• Net before product cost: AED 34,544.

BNPL only (hypothetical):

• Placeholder fee of 4%, ignoring the fixed per-order part: 4% × AED 40,000 = AED 1,600.
• Net before product cost: AED 38,400, if all 100 orders stick.

On direct costs, COD here costs about AED 6.56 per order placed (AED 656 in total), while BNPL costs AED 16 per order. COD looks cheaper.

But the table lies a little. The 12 refused COD orders are 12 lost sales, worth AED 4,800 at full price. And some shoppers who would buy on instalments would never pay cash. Others would buy on COD and never use BNPL. So the real test is not "which is cheaper per order". It is "which method gets me more completed orders at an acceptable margin".

A rough rule: if your COD refusal cost plus lost margin per order is higher than the BNPL fee per order, BNPL pays for itself on that segment. If your margin is thin and refusals are low, COD may be the better default.

How do you decide what to offer? A five-step check

1. Get both quotes in writing. Include the percentage, the fixed fee, exclusions and the notice period for changes.
2. Measure your COD refusals. Use 90 days of data, split by courier, city and basket size.
3. Add up your reconciliation time. Count the hours your team spends matching courier statements to orders each week.
4. Test, don't guess. Offer BNPL alongside COD for 60 to 90 days. Compare completed orders, average basket, returns and net margin per method.
5. Decide by segment. You might keep COD for low-value orders and push BNPL for high-value ones, or the other way round. Review every quarter.

If your store runs on Shopify or WooCommerce, check whether the provider has a plugin. If you sell on Salla or Zid, check the provider's current integration list before you plan around it. We haven't verified which integrations exist today.

Common mistakes

• Comparing fee percentages only. A 4% fee on a delivered order can beat a refused COD order that costs you two courier trips.
• Trying to charge shoppers extra for BNPL. Both providers' terms forbid it, per the sources above.
• Treating COD as free. Courier COD fees, refusals and slow remittance are all costs. They just don't show up on one line.
• Ignoring returns. BNPL doesn't remove returns. Ask each provider how a returned item affects your payout.
• Skipping the written rate. The rate is not public, and Tamara can change fees on 10 days' written notice, per NKM.
• Reconciling COD in a spreadsheet forever. It works at 20 orders a day. It breaks at 200.

Where does software help?

Software doesn't change what Tabby or Tamara charges. It helps with the COD side, which is where the time goes. Quickship's Last Mile Aggregator is a technology tool that puts many couriers on one dashboard and helps you reconcile COD amounts against orders. It doesn't deliver or collect anything itself. Your couriers do that. What you get is one view of delivery statuses and collected cash, so refusal rates by courier and city come from data instead of memory.

Whichever you choose, write down the rule: which orders get which payment methods, who reviews the numbers and when. Then check it again next quarter.