Know your payment gateway…


“If you have a Gun, you can rob a bank. But if you have a bank, you can rob everyone.”

-Bill Maher


Fresh from the grapevine, PayZippy, the payment gateway provided by the E-commerce giant Flipkart, is about to shut shop. What’s more, PayZippy was barely a year old. And to add insult to injury, PayZippy has been ousted by NGpay, an established mobile payment gateway.


Do you feel robbed, too?? Well, I am sure you do.


Let’s stop rambling now and try to spell out the financial jargon in uncomplicated terms.


Ever shopped online? Well you must have. There are many online e-commerce websites like Flipkart, amazon, ebay, Myntra and many more where over the course of your online shopping you must have chosen your payment mode and entered a payment gateway.



A payment gateway is an online application service provider that sanctions the payment for online retailers. In layman terms, it acts as a virtual equivalent for the physical trader who deals in monetary transactions when you are buying his products.


Wondering how all this works? Well, there are various steps involved in the transaction. When a buyer places an order and proceeds to the payment options, it is then that the payment gateway comes into play. After this, it is your service provider who is responsible for transferring your money to the bank via Secure Socket Layer (SSL).The payment processor has taken its course and it works largely through a channel that has been created by tying up with banks and various retailers.


The processor forwards the response to the payment gateway. Therefore, when a customer makes an online payment, the payment gateway is bound to receive the account information from the concerned website. The entire process right from the transaction to the funding, authorization and settlement takes approximately two days.


PayU India, HDFC, CC Avenue, EBS, Axis Bank, ICICI, PayZippy, Citrus Pay, DirecPay, Atom. These are only some of the players involved in the fray in the Indian Market. Each of them have their own tactics to lure everyone, right from the ventures in the nascent state to the well established ones. At first glance, all these options appear to be equally lucrative and an easy solution for a daunting task of selection of an appropriate gateway. However, once you look at the intricate details, you’ll realize that there are major differences in their service elements.

Take for example, the various gateways which are judged on the basis of few service elements, most important being the transaction fee and transaction security since they have taken the onus for safe transfer. Few of the service providers have been compared below on the basis of transaction fee.




Table* of Basic Comparisons



Plan Pay U India Citrus CC Avenue EBS DirecPay
Setup Cost(INR) 6000 0 0 12,000 10,000
Debit Card 0.75% for Transaction Value uptoRs. 2000.1% for Transaction Value above Rs. 2000 1.25% 1.25% 3% 1.25%
Net banking 4.9% 2% 4% 4% 4%
Credit Card 4.9% 2% 3.5% 4% 4%
American Express 4.9% 2.75% 5% 5%

* Source :


Aggregators such as the ones we’ve compared above are just intermediaries. They act as a liaison between banks/credit card processors and theretailers. It is a good practice for the start ups to avail the services of single providers like DirecPay ,PayUIndia etc. This acts as a crucial and strategic maneuver in order to accelerate their growth and amplify your reach. This is achieved by building on the established redundancy of such popular providers.


One can also get involved with more than one provider. However, it is critical to understand that these are mere intermediaries for the burn-in phase of any endeavor. So once one has established their hold on the market, they can afford to get rid of these broker-like gateways. They can directly integrate with banks and consequently improve payment success rates. This will also spell out as reduced commissions.


According to the comprehensive statistics available on the World Wide Web and various case studies by prestigious institutions, we found that CC Avenue is the most popular among startups while the established companies opt for direct integration with banks. CC Avenue has been able to achieve this level with their easy customization of the payment page along with their intelligent restart option and real time check up. Availability of 27 major currencies for easier transfer and more than 100 payment options are also the reasons for its popularity among startups, as well as some of the big sharks.



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