Value Payable Post (VPP) - How it works?

When I wanted to use this service, I couldn't find any proper piece of information about the procedure. 

This is generally used by companies which sell products based on "Cash on Delivery" method. Sometimes an individual who sells items on free classifieds uses this too. 

So now I will try to explain how it works:


Mr.John has some old antique coins which he wanted to sell. He posts a free ad in a classifieds website. Mr.Mark notices this ad and contacts John about the price. They both agree on a price,let's say 500 Rupees. Mark doesn't want to pay up front so he asks John to send a VPP for 500 rupees. 


John goes to the post office, fills VPP form, clearly mentions those details on the letter including VPP value (i.e, 500 rupees). John pays for the postage and takes the receipt. John has to make sure that the packing is firm and solid.


Then a postman delivers the VPP package to Mark and collects 5% extra from him for VPP charges. So Mark has to pay 525 rupees to the postman. In that way, a Postal Department takes this 5% of a given price as a charge for transferring money from Mark to John. Finally, John gets his 500 rupees. 

This is how VPP works.