The headline price of an Indian payment gateway is about 2% per successful payment, plus 18% GST on that fee, which makes roughly 2.36% all-in. Razorpay and PayU both publish exactly that. Cashfree publishes a slightly lower figure and a promotional zero. For most stores the difference between them is smaller than a single month of cart abandonment, and the number that deserves your attention is not on the headline at all.
This post goes through what the three big gateways publish today, the strange case of UPI, and the places where the bill actually changes. We checked each gateway's own pricing page for this. Where a page was vague, or where two pages from the same company disagreed, we say so rather than pick a winner.
What do Razorpay, Cashfree and PayU actually charge?
| Razorpay | Cashfree | PayU | |
|---|---|---|---|
| Domestic cards | 2% | 1.95% listed, 2.0% shown beside it, not labelled by method | 2% |
| Netbanking and wallets | 2% | No separate rate stated | 2% |
| UPI | "Zero MDR — 2% platform fee applies" | "As per the applicable law" | "Varies by business type and transaction volume" |
| International cards | Up to 3% | 2.99% (Visa, Mastercard), 2.95% (Amex) | 3% |
| EMI | 2% | 2.2% credit, 1.5% debit | 3% |
| Setup fee | None | None | None |
| Annual maintenance | None | Not stated as a figure | None |
| GST on the fee | 18% | Charged on top | Charged on top |
Sources: Razorpay pricing, Cashfree charges, PayU pricing.
Three things stand out.
The three are closer than the marketing suggests. On domestic cards and netbanking they sit between 1.95% and 2%. A 0.05% gap on ₹50 lakh of annual sales is ₹2,500 before GST. That is not a reason to rebuild an integration.
Cashfree's page is the hardest to read. It shows two figures, 1.95% and 2.0%, in the same block without labelling which method each applies to, and it gives no UPI percentage at all. Its headline is a promotional offer rather than the standing rate, covered below. If you are comparing gateways, ask each for a written rate card for your specific mix of payment methods before deciding anything.
PayU does not publish a UPI number. It says merchant UPI pricing varies by business type and volume, which means you will be quoted one.
If UPI has zero MDR, why is there a fee on it?
This is the question most store owners ask first and the one the rate cards answer least clearly.
MDR, the merchant discount rate, is the charge a merchant pays the banking system for accepting a payment. For UPI and RuPay debit cards it has been zero since January 2020. A notification reported by Inc42 from September 2026, S.O. 5067(E) dated 14 September, puts that on a statutory footing: no bank or system provider may impose a charge, directly or indirectly, on UPI payments up to ₹2,000 or on RuPay debit card payments.
We could not retrieve the Gazette text itself, so treat the exact wording and any effective date as unconfirmed. The notable detail in the reporting is the ₹2,000 ceiling on UPI. A UPI payment above that is not described as chargeable, but it is not covered by the wording either.
None of this stops a gateway charging you. Razorpay's pricing page says it directly: UPI is "Zero MDR", and a 2% platform fee applies anyway. Cashfree's page describes its platform fee as paying for "Hosted Checkout, Plugins, SDKs, Dashboard, and Generation of Reports". In other words, the bank does not charge you, the gateway charges you for the software around the payment.
That distinction matters in one practical way. A fee that is a software charge is a commercial term, and commercial terms are negotiable in a way that a regulated MDR is not. A store where most revenue arrives by UPI is paying 2.36% for something whose underlying network cost is zero. That is exactly the situation where asking for a custom rate is reasonable, and where it is worth having someone look at your checkout and payments setup if your volume is large.
We would not oversell that. We have not seen a published figure for what a gateway's own cost to process a UPI payment is, so we cannot tell you how much room there is. What we can say is that the published rate is a starting position, not a floor.
What does 2.36% look like on real orders?
Take a ₹1,000 order at the standard 2% plus GST. The fee is ₹20 plus ₹3.60 GST, so ₹23.60, and you receive ₹976.40.
| Annual online sales | Fee at 2% | GST on the fee | Total cost |
|---|---|---|---|
| ₹10 lakh | ₹20,000 | ₹3,600 | ₹23,600 |
| ₹50 lakh | ₹1,00,000 | ₹18,000 | ₹1,18,000 |
| ₹2 crore | ₹4,00,000 | ₹72,000 | ₹4,72,000 |
Two readings of that table.
For a store at ₹10 lakh a year, gateway fees are ₹23,600. Nothing in this post is worth a day of developer time at that scale. Use the gateway your platform integrates with most cleanly and move on.
At ₹2 crore, the fee is ₹4.72 lakh. A one-percentage-point reduction in the headline rate saves roughly ₹2.36 lakh including GST. Now a negotiation, or a UPI-specific rate, pays for real engineering effort. Whether you can claim the GST back depends on your own registration and is a question for your accountant, not something we will guess at.
Are the zero-fee offers real?
Mostly yes, with conditions that decide whether they matter to you.
Cashfree's page leads with "0%" and "Enjoy this pricing for sales up to 20L", labelled a festive offer for new merchants running until 31 March 2027. Razorpay's own blog describes a zero platform fee for merchants who activate on or after 1 July 2026, covering up to ₹5 lakh of cumulative sales or 90 days, whichever comes first, with a one-time ₹199 KYC fee. Both are from the gateways' own pages, and both exclude Amex, Diners, EMI and international cards. Razorpay's pricing page itself does not mention its offer, so we could not confirm it is still running.
The honest framing: these are acquisition offers. The saving on ₹20 lakh of sales at roughly 2% is about ₹40,000 before GST, once. That is nice to have. It is not a reason to choose a gateway, because the standing rate returns afterwards and the migration cost, if you later want to leave, is yours.
If you are a new store, take the offer from whichever gateway fits the platform you are on. If you are an existing store, do not move to chase a promotional rate.
Where the bill actually changes
The headline rate is rarely what makes two gateways cost different amounts. These are.
Payment mix. International cards run at up to 3% on Razorpay, 2.99% on Cashfree Visa and Mastercard and 3% on PayU. Corporate credit cards on Razorpay are 2.15%. EMI is where the three diverge most, from 1.5% on debit EMI at Cashfree to 3% across the board on PayU. A store that sells high-ticket items with EMI is on a different rate card from one selling ₹499 t-shirts.
Refunds. Razorpay states no refund processing fee. It also sells an instant refund product at ₹7.99, ₹11.99 or ₹14.99 per refund depending on the amount. Whether the original platform fee is returned when you refund is something none of the pages we read answered clearly. For a category with a high return rate, that is worth asking in writing before you sign anything.
Settlement timing. Razorpay's pricing page says T+1 or instant, with instant settlement an optional add-on at separate pricing. Its own February 2026 blog post says domestic settlement is typically T+2. PayU's FAQ says standard settlement is T+2, with same-day settlement available for some business categories at a fee. Cashfree's page advertises next-day settlement and quotes instant settlement at 0.30% plus GST on top. For a business with thin working capital, a day or two of settlement is a real financing cost. Often it is bigger than the gap in headline fees.
Subscriptions. Recurring billing is priced separately from one-off payments, and the rules are different enough that we wrote them up separately in how recurring payments work in India. Do not assume the 2% applies.
Which gateway fits which kind of store?
We deliberately do not name a winner, because the evidence does not support one. A decision procedure is more useful.
- Shopify store. Your choice is whatever Shopify supports in India, and the checkout integration matters more than 0.05%. See our Shopify development work for the platform-specific trade-offs.
- WooCommerce store. You can pick freely. Choose the gateway whose official plugin is best maintained, because a broken plugin during a sale costs far more than any fee difference. Our WooCommerce development team has opinions on plugin quality, and they change every year.
- Custom build. You are in the best position to negotiate, because you can integrate directly and move later. Build a thin payments layer so the gateway is a replaceable module, not a decision threaded through your code.
- Mostly UPI at high ticket sizes. Ask for a UPI-specific rate in writing. This is where the commercial room is.
When this advice does not apply
If you sell mainly overseas, none of the above is your main cost. International cards at roughly 3% dominate, and a cross-border payment product is a different comparison.
If you take large B2B payments, card-based gateway pricing is the wrong tool. Bank transfers carry a flat fee. Cashfree lists a flat ₹20 for virtual-account IMPS, NEFT and RTGS, and on a ₹5 lakh invoice that beats any percentage.
If you are below roughly ₹10 lakh a year, do not spend engineering time on this.
And if a rate card on a gateway's own site contradicts its own blog, as Razorpay's does on several categories including corporate cards, Amex and settlement timing, believe the dated pricing page and then confirm in your contract. Pricing pages are updated; blog posts are not.
What we would do
Pick the gateway your platform supports best, read the rate card for your own payment mix rather than the headline, ask for written terms on UPI, refunds and settlement, and keep the integration behind a thin layer so you can move when your volume justifies a better rate.
If you are building a store or a checkout and want a second opinion on the payments design, talk to us. We will tell you plainly if the answer is to leave your current setup alone.
Bharat Vasireddy
Founder & Digital Marketing Strategist8+ years of experience in performance marketing and web development. I help businesses scale through data-driven SEO, Google Ads, and high-performance websites.