What are the charges of Payment Gateways in India?

 

What Are the Charges of Payment Gateways in India?

In India’s rapidly evolving digital economy, payment gateways have become essential for businesses that want to accept online payments seamlessly. Whether you run an e-commerce store, a service-based platform, or a mobile app, integrating a payment gateway helps streamline transactions and boosts customer trust. However, one of the most important factors to consider while choosing a payment gateway is the cost.

This article explores the various charges associated with payment gateways in India, helping you make an informed decision for your business.

1. Setup Fees

Some payment gateways charge a one-time setup fee, while many modern providers offer zero setup cost to attract small businesses and startups.

ProviderSetup Fee (Approx.)
Razorpay      ₹0
PayU      ₹0 – ₹4,900
Cashfree      ₹0
CCAvenue      ₹0 – ₹7,500
Instamojo      ₹0

2. Annual Maintenance Charges (AMC)

AMC refers to the yearly fee for maintaining the payment gateway services. Some providers waive it for the first year.

ProviderAMC (Approx.)
Razorpay     ₹0
PayU     ₹1,200 – ₹2,400
Cashfree     ₹0
CCAvenue     ₹1,200 – ₹3,600
Instamojo     ₹0

3. Transaction Discount Rate (TDR) / MDR

TDR or MDR is the fee deducted by the gateway for every transaction. It varies by payment method:

a) Credit/Debit Cards, Net Banking, UPI

Payment MethodCharges (Approx.)
UPI0% – 0.3%
Credit Card1.9% – 2.5%
Debit Card0.9% – 1.2%
Net Banking1.5% – 2%
Wallets (e.g. Paytm, Mobikwik)2% – 3%

4. Payout or Settlement Charges

Some gateways charge a fee for transferring funds from the payment gateway account to your bank account.

ProviderSettlement Fee
Razorpay          ₹0 (Standard T+2 days)
Cashfree          ₹0 for standard, ₹3–₹5 for instant
PayU          ₹0

5. International Payment Charges

If your business accepts payments from foreign customers, higher charges apply—often between 3% and 5% per transaction.

6. Refund and Chargeback Fees

  • Refund Fee: Usually, gateways do not refund the transaction fee even if you refund the customer.

  • Chargeback Fee: If a customer disputes a payment, you may be charged ₹300 – ₹500 per chargeback.

Conclusion

The charges for using a payment gateway in India vary by provider, business size, and transaction volume. While many providers offer zero setup or annual charges to support small businesses, transaction-based fees still apply. Always compare plans carefully and choose a gateway that balances cost-effectiveness with reliability, customer support, and features like analytics, automation, and security.

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