The most popular mode of payments for online webshops is Cash On Delivery because the customers do not like to pay anything before the products are in hand. In some countries, this is a popular option with internal-based retailers, because this is so easy to set up for small businesses and does not require a bank account or a credit card.
Many small businesses prefer cash payments instead of credit card options. Sometimes few areas have facilities of COD and few have not. So this extension is to Restrict / Check Cash On Delivery by zip codes.