Online Payment Gateways – Compare the best one for you !!

Which is the best payment method

Plastic Money and Digital Money cannot find an existence until there exists a safe system which guarantees security to the consumer and solves the double spend problem for the merchant.
For a developing economy like India, which has youth sharing its major population proportion, emergence of the internet has always been a critical aspect. In this era, when online startups are on a rise, people are actively involved in finding smart solutions for secure payments to the vendor. Yes, we have seen a growth in plastic money solutions, but there an unprecedented increase in the internet based payment section too. Facilitating these are the payment gateways company. 

 As of today, there are more than 50 payment gateway services available in India. In order to accept and make payments fast, secure and convenient, online payment services are playing a vital role in India. Online payment services is a service that authorizes the credit card or the other electronic payments such as a debit card, online banking, cash cards etc.

These online payment services work in a simple manner such as when a user wishes to make a payment through any payment gateway then a merchant’s website sends the encrypted credit card information to that gateway. Then, the online payment services confirm the validity of these card details with the bank and the required amount of money gets transferred from user’s account to the merchant’s account. To provide such services, payment gateways charges fees to an online seller, which could vary depending upon several factors. The Cost of setting up can vary a lot and depends upon:


  • Set-up costs: The One-time fee that you need to pay when you sign up for any payment service.
  • Annual Maintenance cost: You are required to pay the annual or monthly fee for maintenance charges for the service provided by payment gateways.
  • Unit cost per transaction.
  • Domestic/International Transaction or mode of payment by the customer.
  • Discount Rates

How does a payment system works

Following are the best online payment services in India and the cost associated with each:

PayU India

It is a subsidiary of global firm PayU. PayU processes payments with Visa, MasterCards, credit cards; debit cards of more than 50 banks and online payment for banks including Axis bank, ICICI, HDFC and SBI. Rate list of PayU in India is:

  • For Credit Cards, Online Banking or Multi-bank EMI
    • Up to Rs. 4,900 it charges commission 3.90%
    • Up to Rs. 9,900 it charges commission 3.25%
    • Up to Rs. 19,900 it charges commission 2.90%
    • More than Rs. 29,900 it charges commission 2.50%
  • For Debit Cards
    • Transaction of Rs. 2000 or less PayU will take 0.75% commission
    • For the transaction more than Rs. 2000 PayU will take 1% commission
  • Similarly for Cash Cards, Amex, and PayUMoney
    • Up to Rs. 4,900 it charges commission 3.90%
    • Up to Rs. 9,900 it charges commission 3.25%
    • Up to Rs. 19,900 it charges commission 3.25%
    • Up to Rs. 29,900 it charges commission 3.25%
  • PayU India charges from Rs. 6,000 to Rs. 36,000 as a Setup fee
  • Setup fee for Economy plan is Rs. 6,000
  • Setup fee for the Silver plan is Rs. 12,000
  • Setup fee for the Gold plan is Rs. 24,000
  • Setup fee for the Platinum plan is Rs. 36,000


InstaMojo is an Indian start-up company launched in 2012. They offer flawless payment services at attractive rates. InstaMojo can spread your digital content and you have a “Buy Now” button on your website. When a customer taps on that button he/she will be able to buy your product without even leaving your website!

Instamojo charges at least 1.9% of the successful transactions. Instamojo will charge 5% of the transaction if you want to host your content on their website. For instance, if you have priced a song at Rs. 100 and sell it through InstaMojo then you will get Rs. 97.83 in your bank account where InstaMojo will deduct Rs. 1.9 as their fee and Rs. 0.27 as a service tax. InstaMojo does not charge any fee for setup.


PayPal is one of the fastest growing online payment services in India. PayPal is the great option for small online businesses. PayPal provides users a simple, inexpensive and secure way in payment processing and in doing business.

For sake, if you are selling any product or a service on your website then what  PayPal do is it bring payment from your buyer into your bank account and PayPal takes about 4.4% + $0.30 USD commission for the same. If you will sell any product or service via eBay then PayPal charges only 3.9% + $0.03 USD.


CCAvenue is one of the biggest payment gateways in India which offers a wide collection of online payment services. Over 80% of e-commerce merchants in the Indian market are using their services. They accept payments of 27 major currencies. One time setup fee for a popular plan (Start-up) zero and for privilege plan is Rs. 30,000. CCAvenue charge 3.5% on Visa, MasterCard and credit cards and the commission for a debit card is 1.25% and the transaction cost for Net-Banking is 4%. The Annual maintenance charges (AMC) is Rs. 1200. Supported Banks of CCAvenue are HDFC, IDBI, BOI, BOB, ICICI and more.


Since its inception in the year 2000, BillDesk has become a giant in the field of online payments and has over 70% market share. It has integrated with the government departments such as electricity, water, telephone, insurance and is successfully managing their online bill payments. This company is currently valued at above 1M USD. With more and more people migrating to the online bill, we can more and more websites offering BillDesk based payment services.

One of the most interesting aspect about BillDesk’s origin is that it was financed by one of the international public sector banks of India, Bank of Baroda. Such investments from a public sector bank are a rare sight.


RazorPay is the latest and one of the most exciting entrant to the business of online payment. Cultured in the Startup Oasis, RazorPay can have customized payment interfaces for small business that just exist over a blog or a fan page.

This company has also launched an e-POS which makes cashless payments lucid and further, the integration of the gateway to the website is also quite easy.

Being a next generation gateway, RazorPay can accept payments from credit cards, debit cards, net banking and even e wallets. Currently, RazorPay can accept payments only in Indian currency, though international credit cards can work with this gateway.

It is a remarkable feat that online payment gateways have achieved. However, there is a long way to go for these systems. Competitions from mobile and e-wallets, increased level of phishing and data breaching are a few challenges that have to addressed immediately.

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