Practical? Better for the environment?
I'm not sure they really have thought this through, especially for the smaller online seller. Who would be responsible for supplying the return packaging (Environmental impact of sourcing and supplying that) and what is the environmental impact of getting it transported?
At work we repair various old retro computers, customers often ask us to arrange collection which can be time consuming especially when the courier doesn't turn up when they should and can be awkward for the customer. They will have a lot less motivation to stay in to have it collected just for recycling.
My local council now offers a good service: "We now collect unwanted and broken small electrical items. Put your small electrical items in a standard sized carrier bag, tie up and place next to your rubbish on your normal waste collection day.
Local recycling is much better environmentally
Of course the best recycling is reuse, so if it is still useable sell it, give it away (charity, freecycle...)