PayPal vs Razorpay (2026): Which Is Better for Receiving International Payments in India?
- Author:
- Manoj Sharma
- Verified by:
- Editorial team
- Published:
- Last modified:
Short answer
The better choice depends on invoice size and how your clients pay. On a $5,000 invoice, Razorpay pays more at today's reference rate. PayPal is best for receiving card and PayPal-wallet payments from overseas buyers who already use PayPal. Razorpay is best for Indian businesses and freelancers already using Razorpay who invoice foreign clients.
| Use case | Better option | Why |
|---|---|---|
| Invoices around $2,000 | Razorpay | Razorpay pays about ₹13,063 more (1.18% cost vs 8.08% for PayPal). |
| Invoices around $5,000 | Razorpay | Razorpay pays about ₹32,609 more (1.18% cost vs 8.07% for PayPal). |
| Invoices around $10,000 | Razorpay | Razorpay pays about ₹65,185 more (1.18% cost vs 8.06% for PayPal). |
| Need: receiving card and PayPal-wallet payments from overseas buyers who already use PayPal | PayPal | PayPal is built for this. |
| Need: Indian businesses and freelancers already using Razorpay who invoice foreign clients | Razorpay | Razorpay is built for this. |
CurrencyUSD
At the mid-market rate
₹4,73,493
Highest payout: Razorpay
₹4,67,906
- 1.Razorpay₹4,67,906cost 1.18%
- 2.PayPal₹4,35,297cost 8.07%
1 USD = 94.70 INR, ECB reference rate for 3 Nov 2026. Payout = amount minus fees, converted at the reference rate minus each platform's markup, minus 18% GST on fees where charged. Platforms without published pricing are left out.
How do PayPal and Razorpay compare at a glance?
| Attribute | PayPal | Razorpay |
|---|---|---|
| Best for | Card and PayPal-wallet payments from overseas PayPal buyers | Indian businesses and freelancers on Razorpay invoicing foreign clients |
| Fees | 4.40% + USD 0.30 per international payment; fixed fee varies | 1% per bank transfer (Rs 1,000 flat below Rs 1,00,000) + GST |
| FX markup | 3.0% above PayPal's base rate on conversion | States 0% markup on MoneySaver at live rate |
| Settlement | Not confirmed | States 1 day (T+1 after invoice shared) |
| FIRA | Free weekly FIRA; custom Rs 100 + 18% GST each | FIRS within 24 hours of settlement; no charge listed |
| Currencies | Receives USD, EUR, GBP, CAD, AUD, others; states 130+ currencies | Local USD, GBP, EUR accounts plus SWIFT; 30+ currencies stated |
| RBI status | PA-CB in-principle authorisation granted; final not confirmed | RBI authorised PA-CB inward and outward, plus PA-O |
| Indian individuals | Yes, Indian residents 18+, PAN and video KYC | Listed as business type; savings account not confirmed |
| Indian businesses | Yes, proprietors, partnerships, LLPs and companies | Yes, under listed export purpose codes |
| Limits | Export payments above USD 10,000 per transaction are a restricted activity under the PayPal India user agreement. Other limits not confirmed. | Not confirmed |
How much INR do you receive on $2,000, $5,000 and $10,000 with PayPal vs Razorpay?
Each row applies the platform's published fee, FX markup and GST on the fee to the XE mid-market rate for 3 Nov 2026.
| Platform and invoice | Fee | FX markup | GST | INR received | Cost | Best for |
|---|---|---|---|---|---|---|
| PayPal, $2,000 | ₹8,362 | ₹5,431 | ₹1,505 | ₹1,74,099 | 8.08% | Card and PayPal-wallet payments from overseas PayPal buyers |
| PayPal, $5,000 | ₹20,862 | ₹13,579 | ₹3,755 | ₹4,35,297 | 8.07% | Card and PayPal-wallet payments from overseas PayPal buyers |
| PayPal, $10,000 | ₹41,696 | ₹27,159 | ₹7,505 | ₹8,70,626 | 8.06% | Card and PayPal-wallet payments from overseas PayPal buyers |
| Razorpay, $2,000 | ₹1,894 | ₹0 | ₹341 | ₹1,87,162 | 1.18% | Indian businesses and freelancers on Razorpay invoicing foreign clients |
| Razorpay, $5,000 | ₹4,735 | ₹0 | ₹852 | ₹4,67,906 | 1.18% | Indian businesses and freelancers on Razorpay invoicing foreign clients |
| Razorpay, $10,000 | ₹9,470 | ₹0 | ₹1,705 | ₹9,35,812 | 1.18% | Indian businesses and freelancers on Razorpay invoicing foreign clients |
What is PayPal and who is it for?
PayPal is a global digital wallet and checkout provider. In India it operates through PayPal Payments Private Limited, which offers Export Payment Services that let India-resident individuals and businesses receive payments from buyers outside India for the export of goods and services. Received funds are converted and credited to the user's linked Indian bank account through an authorised dealer bank.
- Regulated by: PA-CB in-principle authorisation granted to PayPal Payments Private Limited (RBI application status list, as on 01.10.2026)
- Used by: Yes. Businesses organised in, operating in or resident in India can open a business account (sole proprietors, partnerships/LLPs, companies).
- Best for: Receiving card and PayPal-wallet payments from overseas buyers who already use PayPal
What is Razorpay and who is it for?
Razorpay is an Indian payment gateway that also offers the MoneySaver Export Account (International Bank Transfer). Indian exporters and freelancers get virtual local bank details in the US, UK, Europe and other regions plus a SWIFT account, share them with foreign clients, and receive INR in their Indian bank account. Settlement needs an invoice and buyer address details for each transaction, except for some marketplace and freelancing platform payouts.
- Regulated by: RBI authorised Payment Aggregator, PA-O (19.12.2023) and PA-CB Inward & Outward (Razorpay Payments Private Limited, RBI list of authorised payment system operators)
- Used by: Yes, Indian sole proprietorships, partnerships, private and public limited companies and LLPs that fall under the listed export purpose codes
- Best for: Indian businesses and freelancers already using Razorpay who invoice foreign clients
How do PayPal and Razorpay fees and FX markup compare?
What does PayPal charge?
| Fee type | Amount | When it applies | Best for |
|---|---|---|---|
| Receiving: PayPal payment (balance, card or linked method) from a buyer outside India | 4.40% + fixed fee by currency (USD 0.30) | Fixed fee examples: EUR 0.35, GBP 0.20, CAD 0.30, AUD 0.30 | Card and PayPal-wallet payments from overseas PayPal buyers |
| Receiving: Local bank account details (ACH, SEPA etc.) for Indian users | Not confirmed | No such option found on PayPal India's official pages | Card and PayPal-wallet payments from overseas PayPal buyers |
| Currency conversion to INR | 3.0% above PayPal's base exchange rate when converting payments received into another currency | When foreign currency is converted | Card and PayPal-wallet payments from overseas PayPal buyers |
| Payout to an Indian bank | Funds are credited to the linked Indian bank account via the authorised dealer bank. Standard withdrawal to a bank account is free when no currency conversion is involved; conversion of received foreign-currency payments costs 3.0% above the base rate. A failed withdrawal due to incorrect bank details costs 250.00 (currency as shown on the fees page). Timing is not confirmed. | When INR is sent to your account | Card and PayPal-wallet payments from overseas PayPal buyers |
| Standard dispute fee | USD 8.00 (INR 580.00 for INR transactions) | – | Card and PayPal-wallet payments from overseas PayPal buyers |
| High volume dispute fee | USD 16.00 (INR 1,160.00) | – | Card and PayPal-wallet payments from overseas PayPal buyers |
| Bank return on failed withdrawal | 250.00 (currency as shown on fees page) | – | Card and PayPal-wallet payments from overseas PayPal buyers |
| Refunds | No fee to refund, but the original receiving fees are not returned | – | Card and PayPal-wallet payments from overseas PayPal buyers |
| Custom FIRA | INR 100 + 18% GST per transaction (up to 20), or INR 2,000 + 18% GST for more than 20 transactions | – | Card and PayPal-wallet payments from overseas PayPal buyers |
| GST on fees | PayPal's India user agreement states its fees are exclusive of taxes and that GST-registered merchants receive a PayPal tax invoice and can claim input tax credit via GSTR 2B. Custom FIRA charges carry 18% GST. | Applies to the platform's fee | Card and PayPal-wallet payments from overseas PayPal buyers |
What does Razorpay charge?
| Fee type | Amount | When it applies | Best for |
|---|---|---|---|
| Receiving: US ACH to virtual USD account | 1% (flat INR 1,000 below INR 1,00,000) plus GST | – | Indian businesses and freelancers on Razorpay invoicing foreign clients |
| Receiving: UK FPS to virtual GBP account | 1% (flat INR 1,000 below INR 1,00,000) plus GST | – | Indian businesses and freelancers on Razorpay invoicing foreign clients |
| Receiving: SEPA to virtual EUR account | 1% (flat INR 1,000 below INR 1,00,000) plus GST | – | Indian businesses and freelancers on Razorpay invoicing foreign clients |
| Receiving: SWIFT to virtual SWIFT account | 1% (flat INR 1,000 below INR 1,00,000) plus GST | Razorpay's pricing page groups SWIFT with ACH, SEPA and FPS bank transfers at 1%; intermediary or correspondent bank charges: Not confirmed | Indian businesses and freelancers on Razorpay invoicing foreign clients |
| Receiving: FlashLinks (US) ACH debit payment link | 2% plus GST | Settlement in 5 days | Indian businesses and freelancers on Razorpay invoicing foreign clients |
| Receiving: International cards and wallets | Up to 3% plus taxes | – | Indian businesses and freelancers on Razorpay invoicing foreign clients |
| Currency conversion to INR | 0% FX markup on MoneySaver bank transfers; Razorpay states it converts at the live exchange rate | When foreign currency is converted | Indian businesses and freelancers on Razorpay invoicing foreign clients |
| Payout to an Indian bank | Razorpay converts at the live exchange rate with 0% markup and settles INR to the user's Indian current account (non-INR settlement to an EEFC account is also supported), T+1 after the invoice and buyer details are shared; Razorpay deducts its charges (1%, or INR 1,000 flat below INR 1,00,000, plus GST) before settlement. | When INR is sent to your account | Indian businesses and freelancers on Razorpay invoicing foreign clients |
| One-time setup fee | INR 0 | – | Indian businesses and freelancers on Razorpay invoicing foreign clients |
| Annual maintenance fee | INR 0 | – | Indian businesses and freelancers on Razorpay invoicing foreign clients |
| Enterprise Plan | Custom pricing on request | – | Indian businesses and freelancers on Razorpay invoicing foreign clients |
| Refunds on bank transfers | Not supported | – | Indian businesses and freelancers on Razorpay invoicing foreign clients |
| GST on fees | The MoneySaver pricing page states 'GST applicable' on the Razorpay fee without giving a rate; Razorpay's pricing page lists 18% GST for its domestic payment gateway service and 'taxes' on international card payments. | Applies to the platform's fee | Indian businesses and freelancers on Razorpay invoicing foreign clients |
How do PayPal and Razorpay compare on settlement speed?
- PayPal: Not confirmed
- Razorpay: Bank transfers: 'Settlement in 1 day' per the pricing page; docs state T+1 from the time the invoice or invoice details are shared against a payment. FlashLinks (US): settlement in 5 days
| Platform | Settlement to India | Payout route | Best for |
|---|---|---|---|
| PayPal | Not confirmed | Free to Indian bank without conversion; 3.0% if converting; timing not confirmed | Card and PayPal-wallet payments from overseas PayPal buyers |
| Razorpay | States 1 day (T+1 after invoice shared) | INR to Indian current account T+1, 0% markup, fee deducted | Indian businesses and freelancers on Razorpay invoicing foreign clients |
Do PayPal and Razorpay provide FIRA and e-BRC, and are they RBI PA-CB authorised?
| Platform | FIRA and e-BRC | RBI status | Checked | Best for |
|---|---|---|---|---|
| PayPal | Free weekly FIRA; custom Rs 100 + 18% GST each | PA-CB in-principle authorisation granted; final not confirmed | 30 Sept 2026 | Card and PayPal-wallet payments from overseas PayPal buyers |
| Razorpay | FIRS within 24 hours of settlement; no charge listed | RBI authorised PA-CB inward and outward, plus PA-O | 30 Sept 2026 | Indian businesses and freelancers on Razorpay invoicing foreign clients |
Which currencies, countries and payment methods do PayPal and Razorpay support?
| Platform | Currencies | Payment methods | Indian individuals | Indian businesses | Best for |
|---|---|---|---|---|---|
| PayPal | Receives USD, EUR, GBP, CAD, AUD, others; states 130+ currencies | PayPal payment (balance, card or linked method) from a buyer outside India; Local bank account details (ACH, SEPA etc.) for Indian users | Yes, Indian residents 18+, PAN and video KYC | Yes, proprietors, partnerships, LLPs and companies | Card and PayPal-wallet payments from overseas PayPal buyers |
| Razorpay | Local USD, GBP, EUR accounts plus SWIFT; 30+ currencies stated | US ACH to virtual USD account; UK FPS to virtual GBP account; SEPA to virtual EUR account; SWIFT to virtual SWIFT account; FlashLinks (US) ACH debit payment link; International cards and wallets | Listed as business type; savings account not confirmed | Yes, under listed export purpose codes | Indian businesses and freelancers on Razorpay invoicing foreign clients |
What are the strengths and limitations of PayPal and Razorpay?
PayPal
- Buyer reach: PayPal states access to up to 400 million active accounts globally
- Free FIRA: Weekly Digital FIRA is free to download since Feb 2026
- Regulatory status: listed by RBI with in-principle PA-CB authorisation
- Card acceptance: the user agreement covers payments made through PayPal guest checkout and card chargebacks, so buyers need not hold a PayPal balance
- Cost: 4.40% + fixed fee plus a 3.0% conversion markup is high for large invoices
- Transaction cap: export payments above USD 10,000 per transaction are a restricted activity under the India user agreement
- Disputes: dispute fees of USD 8 (standard) or USD 16 (high volume) can apply, and fees are not returned on refunds
- Holds: PayPal may hold funds for up to 180 days in risk or policy cases
Razorpay
- FX: 0% markup on bank transfers, as stated on the pricing page
- Speed: T+1 settlement for local bank transfers once invoice details are shared
- Compliance: FIRS sent within 24 hours of settlement
- Regulation: listed by RBI as an authorised PA-CB for inward and outward transactions
- Small payments: flat INR 1,000 fee on transactions below INR 1,00,000, which is more than 1% on smaller invoices
- Paperwork: an invoice and buyer address are required for every transaction before settlement (except some marketplace payouts)
- No holding: funds cannot be kept in the foreign currency accounts
- Eligibility: limited to listed export purpose codes and excludes certain merchant categories and NGOs
Should you choose PayPal or Razorpay?
- Choose PayPal if: you need receiving card and PayPal-wallet payments from overseas buyers who already use PayPal.
- Choose Razorpay if: you need Indian businesses and freelancers already using Razorpay who invoice foreign clients, or your invoices are around $2,000 or $5,000 or $10,000.
For example, an exporter billing $5,000 a month: Razorpay pays about ₹32,609 more (1.18% cost vs 8.07% for PayPal).
Which other platforms should you consider besides PayPal and Razorpay?
Other covered platforms ranked by the INR received on a $5,000 invoice.
| Platform | Fees | FX markup | FIRA | INR on $5,000 | Best for |
|---|---|---|---|---|---|
| Skydo | $19 up to $2,000, $29 to $10,000, 0.3% above + GST | States zero FX margin at live rate | States instant, free FIRA per payment | ₹4,70,252 | Indian freelancers and exporters receiving mid to large B2B invoices |
| Kotak Mahindra Bank | No inward, FIRC, SWIFT fee on current accounts; GST on conversion | Card rate, markup not published; 1.71% below mid-market on 7 Oct 2026 | Nil FIRC on current accounts; savings Rs 100 or nil | ₹4,64,889 | Service exporters wanting a current account without inward remittance fees |
| HDFC Bank | No inward charge; physical FIRC INR 200 + taxes; GST on conversion | Card rate ~1.79% below mid-market on 6 Oct 2026; markup unpublished | Physical FIRC INR 200; emailed advice free for trade | ₹4,64,511 | Existing HDFC customers wanting free SWIFT receipts or EEFC accounts |
| Wise Business | Calculator: 1.6% + $2 per payment + 18% GST | Mid-market rate; cost is the 1.6% conversion fee | eFIRC per transfer, 2 USD + 18% GST | ₹4,64,502 | Freelancers and small exporters wanting multi-currency local accounts and eFIRC |
How did we verify this?
Fees, FIRA terms and RBI status were checked on each platform's own pages and RBI sources on 30 Sept 2026. INR figures use the XE mid-market rate for 3 Nov 2026. The formula is on the methodology page.
- PayPal India Merchant Fees, Receiving international transactions; Currency Conversions (3.0% converting balance and payments received; 4.00% all other cases); Withdrawals Out of PayPal; Dispute Fees; Other Fees (Last Updated 28 March 2024) (checked 6 Oct 2026)
- PayPal India User Agreement, About our main business (Export Payment Services); Opening an Account; Restricted Activities (USD 10,000); Holds (180 days); Dispute Fee (guest checkout); Taxes and Information Reporting (GST) (last updated 13 January 2025) (checked 6 Oct 2026)
- PayPal India Foreign Inward Remittance Advise (FIRA) (checked 6 Oct 2026)
- PayPal India Know Your Customer (KYC) (checked 6 Oct 2026)
- PayPal India Business (checked 6 Oct 2026)
- RBI: Status of Applications received under Payment and Settlement Systems Act, 2007 (as on 01.10.2026), Table D: Existing PAs-CB which can operate as Payment Aggregator- Cross Border (checked 6 Oct 2026)
- Razorpay MoneySaver Export Account (International Bank Transfers) pricing, Standard Plan: 0% FX markup, 1% fee, FlashLinks 2%, GST applicable, flat fee of INR 1,000 on transactions below INR 1,00,000, setup and AMC INR 0 (checked 6 Oct 2026)
- Razorpay pricing, International cards and wallets up to 3% plus taxes; MoneySaver bank transfers (SWIFT, ACH, SEPA, FPS) 1% with zero forex markup; 'RBI PA-CB licensed'; 18% GST listed for the payment gateway service (checked 6 Oct 2026)
- Razorpay Docs: International Bank Transfer (MoneySaver Export Account), Supported methods and SWIFT currency list, purpose codes, onboarding KYC, invoices not required for Amazon, Upwork and Freelancer transactions, FAQs on T+1 settlement, EEFC settlement, FIRS within 24 hours, no holding of funds, no refunds, 'Free FIRC' in savings example (checked 6 Oct 2026)
- Razorpay Docs: FIRS Automated Process (checked 6 Oct 2026)
- Razorpay Docs: International Payments FAQs, NGOs not supported for international payments (checked 6 Oct 2026)
- RBI: Authorised payment system operators, Entry 54: Razorpay Payments Private Limited (formerly Razorpay Software Private Limited), PA-O 'Razorpay' 19.12.2023, PA-P, PA-CB I & O (checked 6 Oct 2026)
FAQs about PayPal vs Razorpay
Is PayPal or Razorpay cheaper for receiving USD in India?
Razorpay pays about ₹32,609 more (1.18% cost vs 8.07% for PayPal). At $2,000: Razorpay pays about ₹13,063 more (1.18% cost vs 8.08% for PayPal). At $10,000: Razorpay pays about ₹65,185 more (1.18% cost vs 8.06% for PayPal). Figures use each platform's published pricing and today's reference rate, so check both pricing pages before you decide.
Which is faster, PayPal or Razorpay?
PayPal states: Not confirmed. Razorpay states: Bank transfers: 'Settlement in 1 day' per the pricing page; docs state T+1 from the time the invoice or invoice details are shared against a payment. FlashLinks (US): settlement in 5 days. Check the platform's own pricing page before relying on these figures.
Do PayPal and Razorpay both provide a FIRA?
PayPal: Weekly Digital FIRA free to download from the PayPal business account since Feb 2026; Custom FIRA via Citibank at INR 100 + 18% GST per transaction (up to 20 transactions) or INR 2,000 + 18% GST for more than 20 transactions.
Are PayPal and Razorpay authorised by RBI?
PayPal: PA-CB in-principle authorisation granted to PayPal Payments Private Limited (RBI application status list, as on 01.10.2026). Razorpay: RBI authorised Payment Aggregator, PA-O (19.12.2023) and PA-CB Inward & Outward (Razorpay Payments Private Limited, RBI list of authorised payment system operators).
Can Indian freelancers use both PayPal and Razorpay?
PayPal, individuals: Yes. Individuals must be resident in India and at least 18; a personal account can receive payments for goods and services, though PayPal recommends a business account for those who primarily sell. KYC includes the original PAN card and video KYC.
Should I switch from PayPal to Razorpay?
Switch only if Razorpay pays more on your usual invoice size or fits how your clients pay. Keep the PayPal account open until every invoice sent with its details is paid, and download your FIRA or FIRC records first. Check the platform's own pricing page before relying on these figures.