Paypal VS Razorpay

The convenience in paying for your products and services is a critical part of the customer journey. Here, you need a reliable and secure payment gateway that works for all your customers and ensures the utmost convenience in making a payment.

We have made a fair comparison between the two leading payment gateways, PayPal vs Razorpay so that you can select the best option for your business.

PayPal vs Razorpay: An Overview

Choosing one payment gateway between PayPal and Razorpay will not be easy for you, as both give each other a cut-throat competition. However, a few differences still exist between them.

PayPal offers more financial services as compared to Razorpay. For instance, Razorpay only offers a working capital loan to businesses, whereas PayPal offers a short-term business loan in addition to the working capital loan. Whereas, on the other hand, Razorpay’s integration with multiple SDK platforms, servers, communities, and channels leaves PayPal behind.

Let’s check out other major differences between PayPal and Razorpay based on their features, partner support, pricing, and more.

PayPal vs Razorpay: Feature Comparison

Both the payment gateways offer all the major features, however, there are a few minor differences.

Razorpay offers multi-currency transactions in 100+ countries, which is more than what PayPal allows. In fact, Razorpay is also quicker when it comes to processing refunds as compared to PayPal. Whereas, in the ‘Buy Now Pay Later’ payment model, PayPal allows businesses to take interest free four months installments.

• Ease of Payment Collection: PayPal and Razorpay enable businesses to accept payments from multiple methods. These include payment links, QR codes, payment pages, and more. In fact, businesses can also accept payments in installments, unlike other major PayPal and Razorpay alternatives. In addition to this, both the payment gateways allow businesses to accept in-person payments with their apps, PayPal Zettle and ePOS app.
• Multicurrency Transactions: Both the payment gateways, PayPal and Razorpay support multicurrency transactions. However, Razorpay supports currencies from 100+ countries which is way more than what PayPal supports. But both the payment gateways support automatic free currency conversion.
• Recurring Payments: PayPal and Razorpay, both support recurring payments that allow businesses to accept regular payments for their subscription-based business model. However, the only difference is in terms of the charges that businesses must pay for adding recurring payments.
• In the Standard plan, Razorpay takes a 0.5% charge as an add-on for each payment your customer makes as a subscription fee. On the other hand, PayPal charges a monthly fee of ₹1635.93 for facilitating Enhanced Recurring Payments Services.
• Buy Now Pay Later: Both Razorpay and PayPal offer the Buy Now Pay Later option. To facilitate this service, Razorpay integrates with ICICI PayLater, FlexiPay by HDFC Bank, GetSimpl, and LazyPay. The interest for the Pay Later payments in Razorpay will entirely depend on these providers
• However, in PayPal, if users choose to pay in four months, they are charged no interest, late and sign-up fees. But for 6-, 12-, and 24-month payment plans, users can be charged an APR (Annual Percentage Rate) between 9.99 % to 29.99%. Even in this payment plan, users are not charged any late or sign-up fees.
• Reporting Tools: Razorpay allows users to generate more types of reports as compared to PayPal. In PayPal, you can only create reports for shipping, risk management, mass payments, dispute management, business resource center, and returns, like all other PayPal alternatives. On the other hand, with PayPal you can generate reports for orders, payments, refunds, reversals, transfers, payment links, subscriptions, QR codes, and a lot more.
• Invoicing: You can easily create, review, and send GST-compliant invoices to your customers and get paid faster with both PayPal and Razorpay. In addition to this, these invoices also support currency conversion for the smooth processing of your international transactions.
• Refunds: Refunds with Razorpay are more instant than PayPal. Processing refunds with PayPal generally takes up to 5 business days. However, Razorpay takes about 0-3 days for refunding wallet payments, 2-10 days for net banking, 2-7 days for UPI payments, and more.

PayPal vs Razorpay: Financial Services

In terms of providing financial services to businesses, PayPal offers more options as compared to Razorpay.

For instance, Razorpay offers a corporate credit card. While in addition to a corporate credit card, PayPal offers a Business Credit & Debit card. In fact, while using a PayPal Business Credit Card, users also get a 2% cash back on all purchases, and 3% cash back on all purchases made through the PayPal payment gateway. Moreover, PayPal also offers cash back on its Business Debit card, i.e., 1% rewards on some eligible purchases.

Apart from this, Razorpay and PayPal also offer working capital loans to businesses. However, even in this case, PayPal offers an additional loan service, where businesses can take a fixed term small business loan. Users can easily apply for PayPal and Razorpay loans online after thoroughly going through their terms and conditions.

PayPal vs Razorpay: Integrations

You can integrate PayPal and Razorpay with your website, mobile application, and an eCommerce website. This will help you create a seamless checkout process for accepting payments.

Moreover, Razorpay also offers some additional integrations with SDK platforms, servers, communities, and channels. These include platforms like Flutter, React Native, Shopify, WooCommerce, Wix, Java, Zoho Invoice, QuickBooks, and a lot more.

So, all in all, Razorpay comparatively offers more integration options than PayPal.

PayPal vs Razorpay: Supported Platforms

Both the payment gateways, PayPal and Razorpay support web-based deployment which means they can easily be accessed on Windows and macOS operating systems. You can directly log in with your credentials on their web portal.

Also, both PayPal and Razorpay apps are available for Android and iOS mobile devices. You can easily download them from Google Play Store or App Store. Although, as per the rating and customer reviews, PayPal app ranks higher than Razorpay on both the platforms.

PayPal Rating on Google Play Store: 4.2/ 5

PayPal Rating on App Store: 4.8/ 5

Razorpay Rating on Google Play Store: 3.4/ 5

Razorpay Rating on App Store: 4.2/ 5

PayPal vs Razorpay: Support

In terms of support, Razorpay is better than PayPal as it provides 24*7 support for customers, partners, merchants, and even perspective clients. In addition, oth the payment gateways offer other ways to contact customer support like raising a ticket, accessing a community, and more. Users can also find answers to frequently asked questions in knowledge bases.

PayPal vs Razorpay: Pricing

PayPal charges in two different ways, one for customers, who are paying through PayPal, and the other one is for merchants, who are receiving the payment.

Paying through PayPal is completely free for domestic purchases, when there is no currency conversion. However, for international purchases, customers must pay 3% above the rate of base exchange. This rate differs from currency to currency.

In the case of merchants, they will be charged ₹3 per transaction for domestic payments. However, in case of international transactions outside of India, they be charged at the rate of 4.40% in addition to a fixed fee. This fixed fee may vary from one country to another.

PayPal vs Razorpay: Techjockey’s Verdict

While selecting between PayPal and Razorpay, take into consideration the pricing plans of both payment gateways. PayPal does not charge anything for domestic payments, whereas Razorpay charges ₹3 for every transaction. In fact, for international transactions as well, PayPal’s plans are more affordable than Razorpay.

Moreover, in terms of features, both the products are quite similar. However, Razorpay offers better multi-currency options, reporting tools, and integrations. While on the other hand, PayPal offers better financial services to businesses like a short-term business loan and a business debit card.