While starting an e-commerce store or building a product, choosing the best payment gateway in India is one of the first critical business decision that needs to be made.
What is a payment gateway?
A payment gateway is a platform that makes it simple for customers to pay you the way they want and helps you manage a large number of payments with ease as your business grows.
How does a payment gateway work?
A payment gateway helps to accept payment by aggregating all the payment modes a customer may choose and offering it in a single, easy to integrate package. The best payment gateway offers an exhaustive set of payment methods, offers continuous uptime and high success rates.
Best payment gateway for my business
While at first look, all payment gateways may look similar and claim to be the best, you need to carefully evaluate the options available based on your specific business requirements.
- Are you going to accept international payments?
- Do you want to provide wallets like Paytm as a payment option on your checkout page?
- Would you want to offer “Buy now, Pay later” options for a smooth checkout?
- Does your business have a high average order value that needs multiple EMI options?
- Does your business need to collect recurring payments?
Once you know your requirement, you can evaluate the options. In this blog, we are sharing a list of top 10 things to look out for when choosing the best payment gateway in India for your business.
Top 10 things to look out for
- Modes of payment
The most popular mode of payment for domestic transactions are internet banking, cards(Visa and Mastercard) and UPI. Some customers also prefer to pay via other modes such as mobile wallets like PayTM, Ola Money, Jio Money etc. and other cards like Rupay, American Express, Maestro, Diners Club and Discover.
A larger number of payment modes ensures that the preferred payment mode of the customer is present. Hence always check if, in addition to the most popular payment modes, relatively lesser known payment options are activated. A higher number of payment modes lead to higher success rates.
- International transactions
If you have customers outside India, or customers in India using international cards, it is vital to support international payments. The key challenges around international payments are ease of onboarding — most banks and payment gateways are reluctant to offer international payments, and often ask for hefty security deposits and setup fee.
Customers outside India will prefer to pay in their local currency, so they know the exact amount they are paying. This requires international payment gateways to offer multiple foreign currencies as the payment currency while converting the final payment amount to INR for the merchant’s convenience.
For international payments, the best payment gateway supports multiple currencies with easy onboarding. Paypal is the most trusted and preferred choice of payments for consumers worldwide.
In addition to supporting all payment options like credit cards and direct debit from bank account, Paypal also offers buyer protection. Thus offering Paypal as a checkout option can greatly increase your conversion rates.
- Payment settlement duration
Settlement duration is the time it takes for the seller’s account to be credited after the buyer’s account has been debited.
To understand payment settlement cycle let’s take the example of a customer who makes payment via his HDFC debit card. In this case, when a customer enters payment details, the information is captured by the payment gateway.
The payment gateway encrypts the data and securely sends it to HDFC for authentication. When HDFC approves the transaction, the fund flows from HDFC to the payment gateway and then, from the payment gateway to the merchant’s account.This process typically takes two to four working days.
- Integration support for your e-commerce platforms
If you are selling on any of the e-commerce platforms such as Shopify, Magento, WordPress etc., ensure that payment gateway you opt for has plugin integrations available for the e-commerce platform.
- Fast Onboarding
Many gateway providers promise on-boarding within 2-3 minutes but, might take days before your account is activated. Confirm with the payment gateway provider, the documentation requirement, authorizations & other formalities involved as these things might lead to delay in your account activation.
- Reliable and timely support
Make sure that your payment gateway provides consistent support. You can consider talking to other merchants already using the payment gateway services from that particular provider. It comes handy if you can get a dedicated account manager who becomes your single point of contact at the time of your onboarding and also when you go live. Some platforms also provide real-time assistance by providing communication options like live chat, email etc.
- Allied payout services
Apart from accepting payments from customers, there are other kinds of payments that businesses enter into. Such as managing order refunds, employee wage payouts, marketplace settlements, a collection of recurring payments etc. Many payments solutions that provide payment gateway services also provide services such as auto-collect & reconcile, bulk payouts, marketplace settlements etc. Based on your present and an understanding of your future requirement, you can consider a provider who can provide you with all such services and become a single platform for all your payment needs.
Once your business starts growing, you need a payment gateway that shares regular analytics of your transaction. Some payment gateways have developed smart analytics boards that show you not only a summary of transactions but also provide insights such as your Payments Volume, Number of Transactions, and distribution of your payments across payment methods (Cards, Netbanking, Wallets etc) and platforms (iOS, Android, Desktop) etc. You can analyze this data grouped by hours, days, weeks or months across any timespan
- Checkout experience
A seamless checkout experience — hosted on the seller’s own website — can help you offer a white-label payment experience with your custom layout and branding. It affects your customer’s perception of your online store or product.
Typically a payment gateway charges anywhere between 2 to 3 % per transaction. Based on the mode of payments you choose and volume of your transactions, you can always go for a custom plan. There can be recurring and annual maintenance charges and some platforms may charge a set up free.