Payment Gateway MDR Negotiations

[PM1]

Looking for recommendations on payment gateway for my business, we will have good transaction volumes (₹2-3 crore/month). Wanted to know what is the best possible MDR rates I can get. So far, I have explored Razorpay, Cashfree, and PhonePe, but they have offered only marginal reductions in MDR. I am open to other suggestions or contacts that can help negotiate better rates. And even a benchmark MDR rate I can use for negotiating. Thanks.

 

[JigmeKhesar]

Yes, Rupay CC UPI would attract 1.2% MDR.

even for transactions less than ₹2000?

I ask this because it happened at a store where i buy ice-cream. PhonePe charged them for every transaction.

 

[Abhishek012]

even for transactions less than ₹2000?

I ask this because it happened at a store where i buy ice-cream. PhonePe charged them for every transaction.

I think he is big merchant, only small merchant under 2k payment is free.

 

[Sobirvs]

Do update if you are able to get it done

I don't think it's case if if X merchant get's this pricing, you'll also get the same.

In this case, BM has to do it and BM wants a merchant dept guy to do it from his system and the guy sits in a different office. He isn't getting time. Now he has told me for 2pm tomorrow. Let's see.

Also this pricing might be also coz my of credit line we have.

I am told by HDFC there exists many big merchant (local clothing top retail stores) who have MDR as low as 0.4% but then they have amount like 28cr in their accounts. Also have like 10cr credit line. So BMs usually don't want a customer with good credit limit to leave the bank just coz of small MDR pricing as bank earns alot from the customers who use their credit line anyways.

Also imagine if a local retail clothes store is getting 0.4% from HDFC, then what pricing is Amazon getting? Are they even paying any MDR? Same is the case with PayTM and others. These apps still charge customers from card to bank transfer fee of 2% where as they are prolly getting pricing of 0.4 or less%. But this isn't paytm/amazon being greedy, no. Banks actually strictly tell them to not advertise their pricing to customers or give customers free bank transfer via credit card as then small merchants (whose turn over is 10-25cr) will get mad coz of pref treatment of tech giants.

I was also told if a current account(or other business products) customer is making HDFC 5% profits, HDFC bydefault gives them 1% MDR.

 

[SilentVoyager]

The app can only generate payment links right? Can't use it as a full PG on websites as far as I understand

Yes, smarthub can be used to accept payment using QR/SMS link. But HDFC does have something called "Smartgateway", a full fledged payment gateway that you could integrate with your website or app. They do also have a API documentation available for the same, but never tried it.

 

[PM1]

I don't think it's case if if X merchant get's this pricing, you'll also get the same.

In this case, BM has to do it and BM wants a merchant dept guy to do it from his system and the guy sits in a different office. He isn't getting time. Now he has told me for 2pm tomorrow. Let's see.

Also this pricing might be also coz my of credit line we have.

I am told by HDFC there exists many big merchant (local clothing top retail stores) who have MDR as low as 0.4% but then they have amount like 28cr in their accounts. Also have like 10cr credit line. So BMs usually don't want a customer with good credit limit to leave the bank just coz of small MDR pricing as bank earns alot from the customers who use their credit line anyways.

Also imagine if a local retail clothes store is getting 0.4% from HDFC, then what pricing is Amazon getting? Are they even paying any MDR? Same is the case with PayTM and others. These apps still charge customers from card to bank transfer fee of 2% where as they are prolly getting pricing of 0.4 or less%. But this isn't paytm/amazon being greedy, no. Banks actually strictly tell them to not advertise their pricing to customers or give customers free bank transfer via credit card as then small merchants (whose turn over is 10-25cr) will get mad coz of pref treatment of tech giants.

I was also told if a current account(or other business products) customer is making HDFC 5% profits, HDFC bydefault gives them 1% MDR.

Got it, thanks for the detailed reply!

 

[Sobirvs]

Got it, thanks for the detailed reply!

I however have a Q for every merchant here doing business with Pinelabs. Why are they not giving instant settlement or same day settlement options to the merchants? We are with them from a decade and have done crores worth trxns yet they refuse to give instant settlement. PayTM POS gives that option for 3rs+GST fees. Pinelabs doesn't give such option.

 

[opbamldg]

Any idea about their rates? They had quoted me 1.85% and were not willing to negotiate.

One person in my known has it at 1.18%

 

[Abhishek012]

One person in my known has it at 1.18%

they use Utility, Rent etc category MCC Code.

 

[opbamldg]

they use Utility, Rent etc category MCC Code.

No, MCC code is of automobile repair.