A Review of Major Payment Gateways in India
1st September, 2012: Reviewed PayTM payment gateway service
24th September, 2012: Added Comparison Sheet of Netbanking Options with each provider
There are tons of reviews on Indian payment Gateways; So what prompted us to write one more? Because we feel that many of the old reviews have become less relevant over a period of time and are just an overdose for the first timers. So we wanted to prepare a dummies guide after a personal experience with all major providers.
If you sell something on the internet, you need to have a payment gateway to collect money from your customers. Your payment gateway account enables you to accept payments by credit/debit cards, net-banking & cash cards. So what all options do we have here in India? Just a handful of them and sadly, none of them lives up to the expectations of a merchant.
India is the land of hassles, hassle to get a gas connection, hassle to get a bill passed - and so is getting a payment gateway A/c :) I have personally applied for a payment gateway a/c thrice from 2009 to 2012. Since January, 2012, we have closely worked with quite a lot of payment gateway service providers & have till date facilitated payment gateway accounts for about a hundred customers here @ Zepo. During this period, I’ve communicated with almost all payment gateway providers. Therefore, i thought to write a short review of each option which is worth considering for you
Here is the list of parameters which are important for you to consider while selecting a payment gateway
1. The cost of a payment gateway
Most of the players require us to pay ‘Set-up fee’. (which ranges from 5000 to 50,000) And then they charge you a % on every transaction that happens over your e-commerce website (This is called TDR and ranges from 2.5% to 7%). TDR & set-up fee are inversely proportional to each other. They all offer multiple plans starting with low set-up fee+high TDR & others with high set-up fee+low TDR. In addition to TDR & set-up fee, they also charge you yearly Annual Maintenance Charges (AMC) which range from Rs. 1200/year to Rs. 3600/year.
2. The service & attitude
Opening a Payment gateway a/c is just like a bank a/c. It is necessary to have a good relation with the service provider. And that is possible only if the service provider provides good service. From ensuring least hassle in opening the a/c to smooth operations later on; they should be accommodating and act reasonable with an understanding attitude. Well, i guess that would be too much to ask :)
3. User-interface of Payment Page
This is the only tangible element of a payment gateway provider service. And YOUR customers have to interact with this page to make the payment to you. So before you sign-up with anyone, make sure they have a good & simple-to-use payment page.
4. Other Basic things
There are other important basic things which even though are taken for granted, should be cross-checked with the provider that you are considering. For example - Multiple Payment Options, Stringent Fraud Check Processes, High Uptime, Reliable company / service provider, Sandbox environment, integration API,
Once you figure out the right payment gateway provider & plan for you, half the battle is won :) Then starts the real hassle to complete the loads of required paperwork. If performed at best possible speed, it shall take about 5-10 days to complete all formalities & get a payment gateway a/c. But its doesn’t end there yet! Initially, they allot you 2-3 options to collect payment & all other main options (like VISA & MASTERCARD) are activated later & may take up to a month.
So all of you planning to accept online payment on your ecommerce websites, you better start well in advance (at least 30-45 days before you actually want to start accepting it). I am not pointing-out at any provider or the lack of service. I strongly believe that everyone is doing their best they can in the given conditions & stipulations laid down by RBI.
So now I will list all providers & simply rate them on the above 4 parameters (based out of personal experience & little research). Please note: Paypal is very restricted in India (thanks to RBI regulations) and thus does not come into consideration for any etailer who wants to sell in India. So here are the options worth consideration:
Plans starting from:
Set-up fee: Rs. 0
TDR%: Credit Cards - 5.5% || Debit Cards - 1.25% || Net Banking - 4%
AMC: Rs. 1200
Can be negotiated up to:AMC - Rs. 1200
Basic things: 8/10
More: The biggest 3rd party player in India. Offers a little more payment options as compared to other players in the market. But then comes the arrogance with success. monopolistic attitude :) Late responses for inquiries. Does not negotiate (at least with small players).
Plans starting from: Set-up fee - Rs. 12000 || 5% TDR || AMC - Rs. 3600
Can be negotiated up to || Set-up fee - Rs. 4000 || 5% TDR || AMC - Rs. 2400
Basic things: 8/10
More: One of the good ones among the whole lot, as far as service is concerned. They are pretty accommodating & act reasonable. It has the good UI when compared to others. Competent rates. They are now my 2nd preference because lately their service levels have been falling
Plans starting from
Set-up fee: Rs. 6000
TDR%: Credit Cards - 4.9% || Debit Cards - 1.25% || Net Banking - 4.9%
AMC: Rs. 2400
Can be negotiated up to || Set-up fee- Rs. 4000 || AMC - Rs. 2400
Basic things: 9/10
More: Relatively new entrant in the market & have actually come up with some good features. Currently offering the lowest TDR in the market. Already being used by biggies like Jabong, SnapDeal, BookMyShow and Ferns and Petals. Seems to be more customer friendly than others :) They have definitely maintained their customer service levels, even as they have grown. The USP of this payment gateway is the good practices which they claim results in 12% better conversions.
Overall, with 1 % savings in the form of TDR + better conversion rates, at this moment I would pick PayU as a recommendation. After all, in e-commerce every % matters :)
PS. Zepo offers a free PayU payment gateway with every account. You can read more about it here.
Plans starting from || Set-up fee- Rs. 7500 || 6.5% TDR || AMC-Rs. 2400
Can be negotiated up to || Set-up fee- Rs. 5000 || 6.5% TDR || AMC-Rs. 2400
Basic things: 8/10
More: A reliable company and a part of Times Group. Decent UI. Responsive. For me, they can be counted as an option after EBS.
Plans starting from || Set-up fee- Rs. 15000 || 4% TDR || AMC- Rs. 3000
Basic things: 7/10
More: IIt is a relatively new player in the market but is making doing good as far as their platform and services are concerned. They have one of the best user interfaces around, for a payment gateway. As of now, they are powering major online sites like Snapdeal, Homeshop18, ITC Hotels, Dishtv, PVR, Bagittoday.com. Considering the are still very new, the processing of all applications may take a few more days than usual.
There are other reliable one’s like Billdesk.com which have really high charges but offers the widest payment options.
To know more about the things worth considering before you finalize your payment gateway provider, check out this wonderful article by Santosh Panda, Founder of Ayojak & another wonderful article on 10 Things You Need to Know Before Signing up with a Payment Gateway in India
All these payment gateway providers support net banking. Although the number of banks they support differ. So, we are including a comparison list of all the 5 payment gateway providers mentioned above and the net banking options available with each.
CCAvenue, by far, supports the maximum number of banks. Whereas, EBS, PayTM and PayU, more or less, support the same number of banks.
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1. Above, we have listed only 3rd Party payment gateway service providers. As we think that for start-ups just venturing out to sell online for the first time, direct banks are out of the consideration set due to high set-up fees & more complex formalities. (which include the likes of ICICI, HDFC)
2. We also give an Indian payment gateway for free with every Zepo account.