Selecting The Right Payment Gateway For Your Business

Monday January 23, 2012 , 5 min Read

Whenever I get an enquiry regarding an ecommerce portal, I have to explain what a payment gateway is and most of the time I land up choosing one on behalf of my client.

As a developer it doesn’t make much difference to me what payment gateway my client selects, all I am concerned about is the format in which I need to send the request to the gateway and the format in which I get back the response/status message. For a business owner selecting the right gateway makes a lot of difference.

The aim of this post is to empower people who are planning to setup a payment gateway by providing them a comparative study of popular payment gateway options available in India.

I will not get into details about how a payment gateway works and what you should look for before selecting the correct gateway for your business. Rather I would suggest you to read the Your Story Report on Setting up e-commerce in India.

This post is purely a comparative study of gateways. Hopefully you will be able to select what is good for your business, based on this.

A broad categorization and comparison of the setup fees, transaction and other charges of different payment gateways options available in India:

Company Name	One Time Setup Fee	Transaction costs(Credit /Debit Cards)	Transaction Cost (Net banking)	Annual Maintenance Cost(AMC)
CCAvenue	Rs. 7,500 - Rs. 40,000	3% - 7%	4%	Rs. 1,200- Rs. 3,600
DirecPay	Rs. 10,000	6%	6%	Rs. 2,400
EBS	Rs. 6,000- Rs. 3,000	3.25% - 6%	3.25% - 6%	Rs. 2,400
ICICI payment gateway	Rs. 30,000	3% -5%	-	Rs. 10,000
HDFC payment gateway	Rs. 20,000	3% -10%	-	Rs. 10,000
Bill Junction	Rs. 40,000	2.5%	2.5%	Rs. 5,000

CCAvenue

Plans	Set Up fees	Annual Software Maintenance Cost	TDR ***MasterCard/Visa/Diners/Debit Cards/ATM cum Debit Cards	TDR ***AMEX/JCB/Cash Cards/Mobile Payment	TDR ***Net Banking
Economy	Rs. 7,500/-	Rs. 1,200/-*	7%*	7%*	4%*
Premium	Rs. 25,000/-*	Rs. 2,400/-*	5%*	5%*	4%*
Privilege	Rs. 40,000/-*	Rs. 3,600/-*	3%*	5%*	4%*

Terms & Conditions:

* Taxes as applicable will be levied on set up fees, ASMC and Transaction Discount Rate (TDR) charged by CCAvenue.

** Annual Software Maintenance Charge (ASMC) is charged on a per month basis payable in advance every year in April. Merchants signing on after April need not pay the full ASMC fee. The ASMC fee will be levied on pro-rata basis.

*** TDR = Transaction Discount Rate.

EBS

Plans	Set Up fees	TDR ***	Annual Software Maintenance Cost
Starter	Rs. 6,000/-*	6%*	Rs. 2400/-
Regular	Rs. 12,00/-*	5%*	Rs. 2400/-
Silver	Rs. 18,000/-*	4%*	Rs. 2400/-
Gold	Rs. 24,000/-*	3.75%*	Rs. 2400/-
Platinum	Rs. 30,000/-*	3.25%*	Rs. 2400/-

Terms & Conditions:

*** TDR = Transaction Discount Rate

Service Tax as applicable (Currently 10.3%)

For Starters Package conditions apply

Transecute

Plans	Set Up fees	TDR	Annual Software Maintenance Cost
One Plan	-	5%	-

Terms & Conditions:

Per Transaction Fees: FLAT 5% per Transaction
Supported Cards: Visa / Master
Application Processing Time: 2 Weeks
Service Taxes (Currently 10.3%) extra on all pricing.
Doesn’t support Net Banking

Direcpay

One Time Setup Fee	Transaction costs(Credit /Debit Cards)	Transaction Cost (Net banking)	Annual Maintenance Cost(AMC)	Credit Cards supported	Banks Supported
Rs. 10,000	6%	6%	Rs.2,400	Visa, Master Card	HDFC, ICICI, Kotak, Yes Bank, UTI, IDBI, CBoP, Citibank etc.

Terms & Conditions:

Service Taxes (Currently 10.3%) extra on all pricing.

BillJunction

Particulars	Amount (in Rs.)
System Integration Fee	Rs.40000/- + Service Tax (ST)
All Net Banking Transactions	2.50% + ST
All Credit Card Transactions	2.50% + ST
All Cash Card Transactions	2.50% + ST
Annual Maintenance Fee (AMF)	Rs.5000/-
Security Deposit- Refundable	Rs.5000/-

Terms and Conditions:

System Integration Fee : 100% along with the Merchant application form & KYC
Transaction charges will be debited from the Transaction Amount on upfront basis.
Security Deposit: As approved by the bank
Any new bank that will be integrated with BillJunction will be added to the existing list.
Service Taxes (Currently 10.3%) extra on all pricing.

HDFC Bank

Particulars	Details
Setup Fees	Rs. 20000 + Service Tax(one time non-refundable)
Payment Options	All Master/VISA credit and debit cards and Net Banking
Per transaction fee	3-10% + Service Tax
Annual Maintenance Charges	Rs. 10000/- (recurring yearly)
Payment (credit to current account with HDFC)	T+1 working days

Terms and Conditions:

Fixed deposit could be applicable in case the company does not meet the requirement
Service Taxes (Currently 10.3%) extra on all pricing.

Information / Documents required to obtain a merchant account (can differ depending on gateway company/bank)

Sole Proprietor / Individual

Web site URL
Pan Card/Passport/ Form 60 (If Submitted in last 60 days)
Photo id – Passport/ Election Card/ Driving license
Sole Proprietor Letter
Certificate of incorporation or Certificate of Registration or Shop & Establishments Certificate or Sales Tax / Service Tax
Address Verification (Original Copy of Bank Statement/ Electricity Bill/ Landline phone Bill)
Bank Verification (On Letter head of Bank or Company verified by Bank with Contact details of bank branch)
Lease agreement or ownership deed for business premise / Ration Cards
List of Products & Services on Company Letterhead
Landline Phone Bill (Original Copy of Landline phone Bill)
Last 2 years income Tax Return
Last 6 months Bank Statement.
One Photograph.( of the Merchant )

Partnership

Web site URL
Pan Card/Passport/ Form 60 (If Submitted in last 60 days)
Partnership Deed
Partnership Letter
Certificate of incorporation or Certificate of Registration or Shop & Establishments Certificate or Sales Tax / Service Tax
Bank Verification (On Letter head of Bank or Company verified by Bank with contact details of bank)
Photo id (Passport/ Election Card/ Driving License)
Address Verification (Original Copy of Bank Statement/ Electricity Bill/ Landline phone Bill)
Lease agreement or ownership deed for business premise / Ration Cards
List of Products & Services on Company Letterhead
Landline Phone Bill (Original Copy of Landline phone Bill)
Last 2 years income Tax Return
Last 6 months Bank Statement.
One Photograph.( of the Merchant )

Private Ltd /Public Ltd Co

Web site URL
Pan Card/Passport/ Form 60 (If Submitted in last 60 days)
Bank Verification (On Letter head of Bank or Company verified by Bank with Contact details of bank branch)
Certification of Incorporation, MoA, AoA
Certificate of incorporation or Certificate of Registration or Shop & Establishments Certificate or Sales Tax / Service Tax
List of Directors and Signatures
Board Resolution signed by minimum two Directors
List of Products & Services on Company Letterhead
Landline Phone Bill (Original Copy of Landline phone Bill)
Last 2 years income Tax Return
Last 6 months Bank Statement.
One Photograph.( of the Merchant )

NGO

Web site URL
Pan Card/Passport/ Form 60 (If Submitted in last 60 days)
Bank Verification (On Letter head of Bank or Company verified by Bank with contact details of bank)
Trust Deed
Trust Resolution
Certificate issued under registration with the Charity Commissioners office
Landline Phone Bill (Original Copy of Landline phone Bill)
Last 2 years income Tax Return
Last 6 months Bank Statement.
One Photograph.( of the Merchant )

Note: All the above documents should be duly stamped & signed

PS: I have heard stories of people negotiating some good deals with payment gateway companies, so do try your luck.

Author: Bhanu Pratap Singh Slathia

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