Payment gateway charges in India: what you actually pay
The short answer
Most Indian payment gateways charge around 1.95% to 2% per domestic transaction on standard plans, plus 18% GST on that fee. UPI and RuPay debit cards carry zero MDR at the bank level by regulation, though gateways may still charge a platform fee. International cards cost more, typically around 3%.
Typical rates by payment method
| Method | Typical rate |
|---|---|
| UPI and RuPay debit | Zero MDR at bank level; gateway platform fee may apply |
| Other debit cards | Around 0.4%–0.9% |
| Standard plans, most methods | 1.95%–2% |
| EMI, corporate cards, Amex, Diners | 3% and above |
| International cards | Around 2.95%–3.5% |
GST is on the fee, not the sale
Gateways charge 18% GST on their fee. On a ₹1,000 order at 2%, the fee is ₹20 and the GST on it is ₹3.60.
The UPI question
Since January 2020, UPI and RuPay debit have carried zero merchant discount rate at the bank level. Some gateways still apply a platform fee to UPI payments, so read your plan carefully. Parliament has also passed an enabling law that could allow UPI charges in future, so it's worth watching.
Other costs to check
- Setup and annual fees. Some gateways charge them; many standard plans don't.
- The fine print on 0% offers. Introductory 0% deals usually exclude prepaid, corporate, Amex and Diners cards, EMI and international payments.
- Payment success rate. A cheaper gateway that fails more payments can cost you more in lost sales than it saves.
Selling on Shopify? Its own transaction fee sits on top of the gateway's; see our Shopify or WooCommerce guide.
Frequently asked questions
Are UPI payments free for merchants in India?
UPI carries zero merchant discount rate at the bank level by regulation, but some gateways apply a platform fee, so check your plan.
Is GST charged on payment gateway fees?
Yes. Gateways charge 18% GST on their fee, not on your sale value.
What do payment gateways charge in India?
Standard plans typically charge around 1.95% to 2% per domestic transaction, with international cards costing around 3%.
Where Codemark fits
We connect payment gateways to the sites and stores we build, and help you pick the one that fits your payment mix.
Sources
- Razorpay, Payment gateway pricing by business category in India (UPI zero MDR since January 2020, platform fees, enabling law)
- Razorpay, Cheapest payment gateway in India (standard rates and 0% offer exclusions)
- Commmerce, Payment gateway fee calculator (rates by method and GST on fees)