Best Shopify Payment Gateway in India: Real Fees, UPI, COD and How to Choose

Is Shopify Payments available in India?

No. India isn't one of the countries where Shopify Payments operates, so a store run by an Indian business has to connect a third-party payment gateway to accept cards, UPI, netbanking or wallets. There's no first-party fallback, and no setting that switches it on.

That has two consequences most founders only discover later. First, Shopify charges a third-party transaction fee on every order paid through that gateway, on top of the gateway's own fee. Second, the gateway you choose decides a lot more than price — the UPI experience on a phone, how many payments fail, how fast money reaches your bank, and what COD tools you get.

The only way to use Shopify Payments is to sell through a business entity in a supported country, such as a UK or US company running its own store for that market. That's an expansion decision, not a fee hack, and it's covered in our guide to Shopify Payments versus third-party processors.

What you actually pay: Shopify's fee plus the gateway's

Shopify's third-party transaction fee depends on your plan. From Shopify's India pricing page:

• Basic: 2% of every prepaid order through a third-party gateway
• Grow: 1%
• Advanced: 0.6%
• Plus: 0.2%

Shopify calculates it on the full order value — products after discounts, plus tax and shipping — and it isn't returned when you refund an order. Your gateway then charges its own fee, typically around 2% for domestic payments, with 18% GST on that fee.

Here's a ₹1,000 prepaid order on each plan, using a 2% gateway rate (₹20 + ₹3.60 GST = ₹23.60):

• Basic: ₹20 to Shopify + ₹23.60 to the gateway = ₹43.60 (4.36%)
• Grow: ₹10 + ₹23.60 = ₹33.60 (3.36%)
• Advanced: ₹6 + ₹23.60 = ₹29.60 (2.96%)
• Plus: ₹2 + ₹23.60 = ₹25.60 (2.56%)

On the Basic plan, Shopify's share is almost as large as the gateway's. That's why the plan you're on often matters more than which gateway you pick. For the full plan breakdown, see our Shopify pricing guide.

When upgrading your Shopify plan pays for itself

Because the fee drops as the plan goes up, a higher plan can be cheaper overall once you have enough prepaid volume. Using Shopify India's annual-billing prices (₹1,499, ₹5,599 and ₹22,680 a month for Basic, Grow and Advanced):

• Basic to Grow costs ₹4,100 more a month and saves 1% of prepaid sales. It pays for itself at about ₹4.1 lakh of prepaid orders a month.
• Grow to Advanced costs ₹17,081 more and saves another 0.4%. Break-even is about ₹42.7 lakh of prepaid orders a month.
• Advanced to Plus starts at ₹1,75,000 a month and saves 0.4% more. On fees alone it only pays off around ₹3.8 crore a month, so Plus is a decision about checkout control, automation and scale, not transaction fees — see when to upgrade to Shopify Plus.

Two details change these numbers for Indian stores. Only prepaid orders through a gateway count — COD orders carry no Shopify fee — so a store doing 40% COD needs more total sales to hit the same break-even. And monthly billing costs more than annual, which pushes each break-even up. Run the sums on your own prepaid volume, not your total GMV.

The main Indian gateways compared

Four gateways cover most Indian Shopify stores. All have official apps in the Shopify App Store, no setup fee, and 18% GST on their fee. Published standard rates as of October 2026:

• Razorpay: a flat 2% platform fee across domestic cards, UPI, netbanking and wallets; 3% on international cards. No setup or annual fee. Custom pricing becomes available at around ₹5 lakh a month, and it periodically runs zero-fee offers for new merchants. Also offers Magic Checkout, a one-click checkout with COD controls, for an extra 0.65%.
• Cashfree: 1.95% on domestic cards and netbanking; UPI charged "as per applicable law" with a platform fee; 2.99% on international cards. Strong on settlement speed, including instant settlements, and sells its own one-click checkout and COD/RTO tools.
• PayU: a Shopify-specific rate card listing 0% on UPI and RuPay debit cards, 0.90% on Visa and Mastercard debit cards, 1.85% on credit cards, netbanking and wallets, and 2.85% on Amex, Diners and international cards. Confirm the UPI rate applies to your business category before you rely on it.
• PhonePe PG: 1.99% standard pricing, with frequent zero-fee promotional periods. A natural fit for UPI-heavy stores, given how many Indian shoppers already pay with PhonePe.

On paper, PayU's rate card is the cheapest for a store where most prepaid orders are UPI, and Cashfree edges Razorpay on cards. In practice, the gap between any two of these on fees is usually smaller than the gap in how many payments actually go through.

Why success rate matters more than the headline rate

A gateway's fee is charged on payments that succeed. The bigger cost is the payments that don't.

Say your store sees ₹10 lakh of prepaid payment attempts a month. The difference between a 2% and a 1.95% gateway is ₹500. A gateway whose success rate is just two percentage points lower loses you ₹20,000 of orders in the same month — forty times more — and some of those customers won't come back to try again.

What drives success rate in India:

• UPI on mobile. Most Indian prepaid orders are UPI on a phone. The flow should open the customer's UPI app directly (intent) on Android and handle iPhone cleanly, rather than asking them to type a UPI ID and wait for a collect request.
• Bank and card routing. Better gateways retry or route around a failing bank or card network automatically.
• Saved methods. Returning customers who don't have to re-enter details convert better.

Ask each gateway for success-rate data for your category, then test it yourself: place real ₹1 orders on Android and iPhone, with UPI and with a card, and time each one. For the rest of the checkout, see our Shopify checkout optimization guide.

UPI on Shopify: zero MDR doesn't mean zero fee

Under RBI policy, UPI payments from a customer to a merchant carry zero MDR — the fee banks would normally take. That's why you'll see "0% UPI" in gateway marketing. But a gateway can still charge a platform fee for its checkout, plugin, dashboard and settlement, and several do. Razorpay's standard 2% applies to UPI as a platform fee; PayU's Shopify rate card lists UPI at 0%.

Two things to check before you choose:

• Your UPI share. Look at your last three months of prepaid orders. If UPI is more than half, the UPI rate matters more than the card rate.
• Shopify's fee still applies. Shopify charges its third-party transaction fee on UPI orders just like card orders. A 0% UPI gateway on the Basic plan still costs you 2% per UPI order.

Cash on delivery: no Shopify fee, but not free

COD is still a large share of orders for most Indian D2C brands, and it's simple to switch on: in your Shopify admin, go to Settings → Payments → Manual payment methods and activate Cash on Delivery (COD). Shopify doesn't charge its third-party transaction fee on manual payment methods, so COD orders carry no Shopify fee at all.

COD has its own costs, though: the courier's COD handling charge, slower cash flow, and above all RTO — orders refused or undeliverable and shipped back at your expense. On a high-COD store, RTO usually costs far more than any gateway fee.

What Shopify can and can't do natively:

• It can't add a COD surcharge to the order total on any plan. Payment customizations can hide, rename and reorder payment methods, but not change the price.
• Workarounds: a shipping rate named as the COD fee, or a COD app built on Shopify Functions that links a fee rate to the COD option and hides COD by pin code, order value, product or customer tag.
• Partial COD and COD-to-prepaid nudges — small upfront payments, or a discount for paying online — usually come from one-click checkout providers.

The goal isn't to remove COD; it's to offer it where it's profitable. Our guide to Shopify returns and RTO management covers the full playbook.

One-click checkouts: GoKwik, Razorpay Magic Checkout and others

A popular option for Indian stores is a one-click checkout — GoKwik, Razorpay Magic Checkout, Shopflo, Shiprocket's Fastrr and similar. They replace the Shopify checkout with their own flow: the customer logs in with a phone OTP, the address is pre-filled from a shared network, and COD is shown or blocked based on that buyer's RTO risk. The finished order is then pushed back into Shopify.

What you gain:

• Faster checkout for repeat buyers across the network, which can lift conversion on mobile.
• COD intelligence — blocking risky COD, partial COD, prepaid incentives — which can cut RTO meaningfully.

What you give up or need to check:

• Shopify's native checkout features. Checkout extensions, some discount and gift-card behaviour, Shopify's own abandoned-checkout data and analytics now depend on how well the provider syncs with Shopify.
• Fees. These providers charge their own fee or a higher payment rate (Razorpay lists Magic Checkout at 0.65% extra). Because the payment doesn't run through Shopify's checkout, Shopify's transaction fee often isn't applied the same way — but that depends on the provider's setup and on Shopify's terms, which can change. Treat any saving as a bonus, not the reason to switch.
• Tracking. Make sure purchase events still reach Meta, Google and your analytics correctly. Broken attribution after a checkout switch is common — see how to fix Shopify conversion tracking.

A one-click checkout usually earns its place when COD is a large share of orders and RTO is a real cost. For a mostly prepaid brand, a well-tuned Shopify checkout with a strong gateway is often enough.

Selling internationally from India

If you ship to customers in the UK, US or elsewhere, your gateway needs to accept international cards and settle in INR under RBI's cross-border rules. Expect higher fees — around 3% on international cards at most Indian gateways, plus GST — and check whether the gateway shows prices and charges in the customer's currency or converts everything to INR.

PayPal is still worth offering for overseas buyers who don't want to enter a card on an unfamiliar Indian site. Once international sales are a real share of revenue, a separate store under an entity in the target country can use Shopify Payments and local payment methods. Our guide to Shopify multi-currency and international pricing covers the setup.

How to set up a payment gateway on Shopify in India

Gateway approval is where most launches stall, so start it before the store is finished.

• Keep KYC documents ready: PAN, GST certificate if you're registered, bank account proof, and business registration details.
• Make the site approval-ready: gateways review your store before activating it. Have a contact page with real details, and live privacy, refund and cancellation, shipping, and terms pages, with products priced in INR.
• Install the gateway's official app from the Shopify App Store and connect it to your account, then activate it under Settings → Payments.
• Test with real money: place small orders with UPI and a card on both Android and iPhone, and run a refund to see how it flows back.
• Check the order trail: paid orders should show as paid in Shopify within seconds, with the right payment method recorded.
• Reconcile the first settlement: match the gateway's settlement report against Shopify orders, so GST and fee deductions make sense before volume grows.

If you're still at the planning stage, our guide to starting an ecommerce business on Shopify covers registration and the order to do things in.

Which gateway should you choose?

There's no single best gateway for every Indian store, but the right choice by stage is fairly predictable:

• Just launching: choose for fast approval and a smooth UPI flow — Razorpay and Cashfree are the usual picks — and use any zero-fee introductory offer. Stay on Basic until prepaid sales get near ₹4 lakh a month.
• Mostly UPI, price-sensitive: get PayU's Shopify rate card and a PhonePe PG quote in writing; a low UPI rate can matter more than the card rate.
• ₹10 lakh to ₹1 crore a month: negotiate custom pricing, compare success-rate data rather than headline rates, move to the Grow plan, and look hard at COD and RTO before adding a one-click checkout.
• Selling abroad: make sure the gateway handles international cards well, add PayPal, and plan for a separate entity and store once overseas sales justify it.

Whichever you pick, review it once a year. Pricing, offers and success rates change, and switching a Shopify gateway is a small job compared to running on the wrong one for years. The scaling guide from ₹1 crore to ₹10 crore covers what else changes as a store grows.

FAQs

Is Shopify Payments available in India? No. Indian businesses must use a third-party gateway such as Razorpay, Cashfree, PayU or PhonePe PG. Shopify Payments is only available to businesses in supported countries.

What are Shopify payment gateway charges in India? Two fees apply to every prepaid order: Shopify's third-party transaction fee (2% on Basic, 1% on Grow, 0.6% on Advanced, 0.2% on Plus) and the gateway's own fee, typically around 2% plus 18% GST. On a ₹1,000 order on Basic with a 2% gateway, that's about ₹43.60.

Which is the best payment gateway for Shopify in India? It depends on your mix. Razorpay and Cashfree are the most common choices for ease of setup and UPI experience; PayU's Shopify rate card is the cheapest listed for UPI; PhonePe PG suits UPI-heavy stores. Compare payment success rates, not just fees.

Does Shopify charge transaction fees on COD in India? No. Cash on delivery is a manual payment method, and Shopify doesn't charge its third-party transaction fee on manual payments.

Can I accept UPI on Shopify? Yes, through any Indian gateway's Shopify app. UPI carries zero MDR, but gateways may still charge a platform fee, and Shopify's own transaction fee still applies to UPI orders.

How do I integrate Razorpay with Shopify? Complete Razorpay's KYC, install the Razorpay app from the Shopify App Store, connect your account, and activate it under Settings → Payments. Then test with real UPI and card orders before launch.

Can I add a COD fee on Shopify? Not natively on any plan. Use a shipping rate named as the COD fee, a COD app built on Shopify Functions, or a one-click checkout that supports COD fees and partial COD.

Do one-click checkouts like GoKwik avoid Shopify's transaction fee? Often, because the payment doesn't run through Shopify's checkout — but they charge their own fees, and the treatment depends on the provider's setup and Shopify's terms. Choose them for COD and conversion benefits, not to avoid the fee.

Our take

For most Indian Shopify stores, the biggest payments win isn't switching gateways — it's being on the right Shopify plan for your prepaid volume, getting UPI right on mobile, and controlling where COD is offered. After that, negotiate your gateway rate once you have volume, and judge gateways by how many payments succeed rather than by a 0.05% difference on a rate card.

This is the kind of setup we handle for D2C brands as part of Shopify custom development — gateway and COD configuration, checkout rules and payment tracking — and as part of Growth Marketing & CRO when the goal is lifting checkout conversion. If you're not sure where your store is losing money at checkout, the free Shopify store audit is a good first look.