HN Explorer

Tell HN: PayPal Charges 10.57% in Fee (USD-INR)

24 points by saradhi ↗ HN
For a user payment of USD282.89, we have received an INR 19,973.10

We have multiple payment gateways on our platform

1. PayPal - Accepts most cards. But hefty 10.57% in FEE

2. Stripe - Often reject INR Transactions as INR payments require 3D authentication

3. RazorPay - Disabled international transactions for 6 months. Forced to link PayPal on Day 1.

RazorPay comparatively takes less transaction fee that the other 2. But they don't allow international transactions in the first 6 months.

Any suggestions of good payment gateways, for Indian registered company, for International Transactions?

31 comments

[ 5.0 ms ] story [ 30.3 ms ] thread
[dead] blueanchovy
[dead]
r1jsheth
I know about wise but have you used the other two? How was the experience?
blueanchovy
sorry, haven't used, just knew about them
superasn
Also paypal withdraws everything to your bank account everyday and leaves a $0 balance so you can't process any intl refunds.

Payment processing is still very hopeless in India.

ghoul2
Best I understand it, this is required by Indian rules. They cannot permit you to carry out "banking" transactions with your paypal account. Meaning the dollars received must get back to a "real" bank account denominated in INR. And any USD you need to send out must be obtained by sourcing INR from your bank account, going thru RBI to get those USD (so they can monitor and control forex flows, including annual limits etc).

In brief, paypal is not a bank (in India) and is not allowed to act like one. Any money it receives it needs to transfer to a real bank immediately, and money to be sent out must come from a real bank as well.

TekMol
Do you only need a payment gateway?

I'm in Europe and there is a lot more to accept payments here:

You need to ask the customer for their location and then calculate VAT and other tax details depending on where they are.

You need to ask for their address and send them an invoice.

You need to store all that data and create tax reports from it.

I have not started to sell digital goods yet, but I am planning to.

Any tips on payment providers who abstract all of that away?

I think the payment provider then has to be the one from whom the customer buys the service and your "customer" is the payment provider?

I'm surprised there is not a big player who handles this for all online merchants around the world already. It must be a giant business.

[deleted]
(comment deleted)
radiojasper
> Any tips on payment providers who abstract all of that away?

Stripe, Mollie. Mollie is kinda awesome and they're affordable and offer a vast array of payment systems, including a whole bunch of local systems like iDeal for NL markets, Przelewy24 for Polish markets, Bancontact for Belgium and a lot more.

TekMol
I don't think that Stripe offers that the customer buys the product from them and Stripe buys it from you?

If not, you are still left with one hell of a complex tax reporting. Even if Stripe should help you to gather all the needed data.

Does stripe handle the invoicing? So that every customer gets an invoice they can use in their country?

radiojasper
If you want to run a(n online) business, you will have taxes to do and paperwork to keep up with. No single payment provider will take that away from you, you just need to pay a bookkeeper for that.

Also:

> I don't think that Stripe offers that the customer buys the product from them and Stripe buys it from you?

I have no idea what you mean with this, sorry.

> Does stripe handle the invoicing? So that every customer gets an invoice they can use in their country?

Yes, Stripe does invoicing. How else are you going to book it into your own administration?

TekMol
So if Stripe works, why do you suggest Mollie? Isn't Stripe kind of the gold standard?
radiojasper
Sorry for recommending alternatives!! I will never do it again.
yabatopia
Thank you for recommending alternatives!
yabatopia
That's a very US-centric point of view. The world is bigger than US tech companies. Mollie is very popular in certain regions in the EU, with lots of local integrations. It would make little sense to use Stripe in such cases. Look for what works best for you, not what you think you should use according to US-based platforms/media.
nerdawson
My suggestion would be to use a Merchant of Record such as Paddle.

They worry about all the complexities of payments, invoicing, taxes, etc.

That stuff is a huge headache and could really blow up in your face if you get it wrong. Paying 5% of top line revenue to take it off your plate seems worth it to me.

albertopv
In Italy most of merchants use Paypal, Stripe or Nexi.
radiojasper
I don't get why 3D authentican is a problem? That's just baked into my CC app?
kc10
I assume OP is referring to the complexity with recurring payments from Indian customers. Since April 2021, India has rules that makes it really hard to accept recurring payments. In addition to the 3DS authentication at setup, the transaction has to go through 3DS authentication every month for transactions over Rs.15000($190).

To simply explain the flow, every month an email would need to go to the subscriber and the subscriber has to approve the transaction via 3DS. Only then the recurring transaction will go through.

radiojasper
Oh that's a hassle indeed and totally bad for business because it gives the client the 'opportunity' to rethink their expenses each month. Thanks for explaining this!
nerdawson
Take the payment in USD using Stripe, connect it to a Wise borderless account, and let Wise handle the currency conversion.
saradhi
Wow. Never knew Wise offers business account going to open it now. Hoping this works.
kc10
Does it not require to go through 3DS for recurring transactions if billed in USD?
nerdawson
Presumably Stripe is equipped for whatever type of auth / verification is required.

The solution outlined was really just intended to fix excessive exchange fees. Bill in USD and deposit the funds directly into Wise which acts like a regular US bank account.

kc10
cool..ya, Stripe is capable of sending out advance email notifications to capture 3DS for recurring payments. But user has to complete the 3DS authentication every month for the payment to go through. It's just a hassle to remind the user every month that they have to complete the AFA on time and code the processes in the system to deal with delays

more details - https://stripe.com/docs/india-recurring-payments

phraze
Wise.com does really good value international transfers. Usually cheaper than most competitors when considering inflated exchange rates.

Not sure if they offer a gateway though, they do have business accounts and an API which might suit your needs

ratg13
You could use Stripe to charge people in USD/EUR and then use Wise to transfer from Stripe to your bank while doing the change to INR along the way.

This would probably be the most cost effective method.

ChrisLomont
For those interested, the reason places charge high rates on some exchanges is to cover risk. Here [1] is USD versus INR - look over the past year.

Look at USD to CAN or GBP or EUR on the same site for comparison.

Another factor is liquidity in the markets allowing those doing exchanges to offload unbalanced books efficiently.

[1] https://www.exchangerates.org.uk/USD-INR-exchange-rate-histo...

surds
I have been there and this situation sucks.

I have been testing payments with Stripe, using both an Indian and a US credit card.

I have standing instructions on Indian CC and get advance email notifications but it goes through.

Don’t even get any notification for US CC, except post payment notification.

Experience may vary for larger amounts, as mentioned in the comments here.