Cash on delivery in India is not only due to black money or people carry lots of cash, I reckon and based on my own analysis and multiple discussion with colleagues and acquaintances there are multiple reasons behind cash on delivery.

1. Wrong or damaged product is often sent by Indian eCommerce company - happened to me couple of time and for the time I received correct product in good condition my money is blocked and like anyone in the world I dont want to block my Credit card money.

2. E-Commerce giant like Amazon has introduced Mobile POS Cash on Delivery option where after receiving your goods you can pay using your card.

3. Indian loves to expend, even beyond their limits, hence most of the people even in metros dont want to own a credit card as they know they can not control their purchases and they are also scared of interest rates for unpaid bills in India is very high.

The major reason behind cash as King in Indian E- Commerce market is trust and poor customer support system. I have seen Software professional from large cities where product is delivered in a day, preferring second option.

Whether its Indian or American or Chinese(Alibaba) e-commerce company in India, they should do something to gain trust of Indian consumers.