Indian Payment Gateways – a big joke?

Thinking of using Indian Payment Gateways for your online service? Don’t go for them, they are a big joke. Here is info about some of the payment gateways.

CCAvenue: They are considered to be the best providers in India. (There is no competition in the market) They provide online order processing via Net Banking as well as by credit card. They charge Rs. 7500 as setup fees, 7% transaction fees for Credit Card Processing and 4% transaction fees for net banking. They also charge Rs. 1200 per year as Annual Software Maintenance Cost. (lol just another way to get yearly fees) They have other plan which costs Rs. 25,000 as setup fees, 5% transaction fees for Credit Card processing and 4% for net banking. The annual fees they charge is Rs. 2400 as Software Maintenance Cost.

But note that, it is not so easy to get account with them if you are running a web development firm. My personal experience was very bad with them. I felt as if I am begging for an account.

I applied for a basic account (Rs. 7500 one). Within 4-5 days I got email saying my account got rejected because I am running a web development firm and it is owned by a single person. This one was one of the worst excuse that anyone could give. But after requesting them couple of times, they approved only net banking facility on my account. I was left without credit card processing which was my primary concern for applying the account.

Few days back I decided to ask them again to activate the credit card processing. I sent them an email and talked to their person in legal department over the phone. They took more than a week to decide and finally today she told me that if I want credit card processing on my account I will have to deposit Rs. 30,000. And they repeated the same reason about having a single ownership web development firm. They also told me that, they are asking for this amount as security deposit for chargebacks.

So in short, they are giving silly reasons despite of me signing their legal documents which says they have right to sue me if I don’t pay them chargeback money.

I am currently using 2checkout.com, they are 10 times bigger than CCAvenue and they activated my account within 1 hour after the signup. The only problem I have with them is, payment delay. It takes approximately 20 days to get the payment.

But I think applying for CCAvenue is just waste of money if you are running a proprietorship web development / hosting firm.

Transecute: This is another payment gateway service from India. (I think it is service of Directi) But like CCAvenue, they are also useless. They charge Rs. 30,000 as setup fees and 5% transaction fees. But one good part is, they do not charge any annual fees.

ABCPayments: This service is by IndiaMart, InterMesh. Their rates are almost same compared to CCAvenue. Rs. 7,000 setup fees, Rs. 2,000 per year as annual rent and 7% transaction fees. The same plan is available for Rs. 10,000 one time and no yearly fees. The other plans are Rs. 10,000 and Rs, 16,000 with annual rent as Rs. 4,000 and Rs. 6,000, transaction fees %6 and %5 respectively. They also offer net banking but it is limited to few major banks only. As of October 2009, ABC Payment has shut down their service.

Payseal ICICI: They have not provided any rate related information on their site. As far as I know, they charge Rs. 25,000 as setup fees and 5% as transaction fees. (I have emailed them for exact rates) For integration with this payment gateway, you need Tomcat installed on your server. (Or any application which can run JSP pages)

PayGateIndia: The rates mentioned on their site range from 0 setup fees to Rs. 8,000 setup fees. Their economy package costs Rs. 0 as setup fees but 8% as transaction fees and Rs. 750 per year as annual cost. Their rates are very cheap compared to other payment gateway service providers but I am not sure about credibility of this payment gateway. They seem to be reseller of ICICI Payseal. (I have emailed ICICI to confirm their validity)

Eazy2Pay: Again, like ICICI, these guys too do not have rates mentioned on their site. But after exchanging few emails, I got the details. It starts with Rs. 10,000 setup fees and 5% transaction fees. Fees is one time fees and no annual charges. Their best plan is Rs. 25,000 setup fees and 3.5% transaction fees. They have few big companies in their client list. So it holds some credibility in its bag.

Update – June 30, 2007:

Cashwala or EBS - This one is by UTI Bank. Their pricing seems to be pretty high, Rs. 11,000 one time charge, 6% transaction rate and Rs. 6000 every year as Maintenance Charge. Check more plans here

But to cut everything in short, compared to international payment gateways these guys are way too costly. Currently only few players are in market so they are charging whatever they want but once Google comes into play (I think they are currently setting up Checkout service in India, it might take longer time too), their rates are going to reduce a lot.

Currently PayPal and 2checkout are good payment gateway providers and their transaction and setup fees are also very reasonable. But the only thing they lack is, time to deposit the funds in our accounts. It takes approximately 15-20 days.

Update: Rejoice!!!! Paypal has introduced direct funds transfer to your Indian Bank Account.. The best part is, they do not charge any fees for funds more than
Rs. 7,000 (otherwise it is Rs. 50). The whole process takes 5-7 days. Thanks Venkat for the heads up.

I hope Google Checkout starts in India soon.

Posted under Mera India, Personal Notes, Tech Tech, Tips by Deep