Payment gateways in India
Every person looking to start a business online faces a daunting task, to choose a payment gateway. You require a safe, quick, diverse and most importantly, reliable gateway to get the best out of your company. Before we get started on the Indian scenario in this competitive market it is important to understand what a payment gateway really is.
Essentially it is an application service provider that facilitates the payment through your cards when you buy something online. When a customer buys a product online it is the payment gateway which receives the account information from the concerned website. If it is a net banking transaction the gateway directly engages with the customer’s banks. If it is a card transaction then these details are passed onto the issuing bank, which checks up with the Visa and MasterCard network and after confirming the information it transfers the payment to the payment gateway which cuts its commission and then transfers the funds to the e-commerce site.
Choosing a payment gateway can be a tough task. While there are certain larger fishes in the pond, the smaller ones have quite interesting features which makes them hard to resist. Different customers have very different needs in terms of the gateway service that suits them best. If your company handles a very large amount of daily transactions then the facility you would require is very different from those who handle a lesser volume.
So what all should be kept in mind while choosing your payment gateway?
First and foremost the reliability of the service, you don’t want to lose out on a valuable customer just because there is an error in the payment. Success rate is one of the biggest criteria to evaluate a payment gateway. “Even a 1% improvement in success rates can add Rs 20 crore to our topline,” says Kunal Bahl, CEO, Snapdeal.
Good Rates – There is no use of a reliable gateway if it doesn’t offer you a good package that suits your needs. The advantage here is that with the growing number of players in this field now the packages available are actually quite competitive from a customer’s point of view.
Diversity – A payment gateway needs to be diverse. By diversity I mean that it should offer a large number of medias for payment that a customer can choose from.
So let’s see some of these payment gateways that we have been talking about above.
Not in order of preference
- CCAvenue: It is one of the largest payment gateways operating in India. It offers more than 100 payment options and collects funds in over 27 different currencies. It also allows users to extensively customize their payment page and thus helps create a more engaging environment for the end user. It allows a quick mode of retry in case the initial payment fails and thus increases the chances that a customer would opt for a retry rather than just leave the page in case of a transaction gone bad. CCAvenue has a well integrated real time check up and analytic system that keeps tap on every transaction especially the ones that go bad, sending the website a detail as to exactly why the transaction failed thus helping in improving the system, all this along with its round the clock customer support, something that no other Indian payment gateway provides. It offers T+2 Payment Settlement.You will find most of the big online companies using this.
- Citrus: Citrus as in the same citrus behind the cool and innovative Citrus pay app to tackle the everyday problem of ‘chuta nahin hai’. Well most of you must have heard of the app but did you know that it was the brainchild of CitrusPay, a leading payment gateway in India. Its customers are on a whole quite pleased with its services as it offers one of the best success rates in the industry. Citrus is technologically quite advanced and sound. It also allows a whole range of tools for the end consumers that help in making the shopping experience more fun.
- Atom: With a client base of over 4500 companies and more than 100 payment options, Atom is not really an atom in the field of Payment gateway, it is actually quite a major player in India. Its services includes over 5 credit cards including MasterCard, American Express, etc, 50+ Debit Cards options and over 50 net banking options all of which have together made it boast of its 15 million plus transactions to date. It caters to a large variety of industries, however their major client base comprises of education, government services and travel and tourism.
- DirecPay: It offers a very diverse product line allowing customers to access through internet and IVRS. They also work closely with agencies to optimize SEO and PPC advertising for their customer websites. Other unique features include dropped transaction tracking, automated reconciliation, real time MIS and on demand analysis & reporting tools. DirecPay with its affordable plans and products is a good prospect for a large number of online businesses as it allows them to focus on sales and leave the payment part on them.
- PayPal: The global leader and pioneer in the field of payment gateways. PayPal used to be a favorite in India due to its ease of setting up. However, a couple of years back, banking regulations drastically reduced its footprint. An Indian company cannot accept Indian credit cards via Paypal, but can accept foreign credit cards. In India it is mostly used for payment across the borders in different currencies. At the time of writing it was still owned by the online mega giant eBay and although the two do look towards a split up, PayPal continues to be a global leader in for online payment companies. It allows you to send money not just to companies it works for but also to anyone with a PayPal account, anywhere around the globe. Although it is a little bit more expensive than the other Payment gateways mentioned in this article it has to be noted that it is also one of the most well established companies in its field globally.
- EMVANTAGE: EMVANTAGE boasts of a very high transaction success rates, one of the highest in India. It offers users to choose from a wide variety of payment options and also lets them use prepaid cards like Rupay, etc. High security and its user friendly interface add to its aura. It also allows merchants to sell through SoMe(Social Media), converting the like button on facebook to a buy button. Apart from that it offers T+2 settlement policy and EMIs across 10 banks.
- PayU: Another gateway with a very fascinating transaction success rates; however in the case of PayU the biggest advantage is that it allows you to go live quite fast and at very affordable prices. A part of the huge Naspers Group that recently acquired Redbus, PayU offers features such as iFrame solution for secure collection of card data, 1 Click checkout, Payment analytics, IVR payments and Email Invoicing. PayU also runs a second facility called PayU money which offers end users upto 10% instant cash back when they pay using it on over 8500 sites around the net.
- Zaakpay: It offers both web and mobile payment options and lets its customers choose their plans depending on the expected volume per month. It offers a unique T+1 settlement clearing process and boasts of having powered over a billion rupee transaction to date. Its mobile version allows customers to collect in app payment in android and iOS at an absolute zero installation fee.
Listed below is a table comparing the prices of various gateways listed above. Atom has been left out due to lack of information and PayPal is an international service making it quite difficult to grade them in terms of other Indian payment gateways.
|Set up fee||0-40,000||0||–||0-30,000||–||0-25000||6,000-36,000||10,000-30,000|
|Annual Maintenance Fee||1200-3600||0||–||2400||–||Plan dependent||2400||0|
|Lowest TDR for Credit Cards||2.5||2%||–||2%||–||2.25%||2.75%||2.25%|
|Lowest TDR for Debit cards||1.5||1%||–||1.25%||–||1.25%||0.75%||2.25%|
|Lowest TDR for net banking||2.5||1.6%||–||2%||–||2.25%||2.75%||N/A|
|Lowest TDR for Cash cards||3.6||0||–||N/A||–||2.9%||3%||N/A|
Poll in the next page.