Quick answer
A gateway fee is what your payment provider charges to process a payment. A platform transaction fee or commission is an extra percentage your store platform takes on each order. A fixed plan price is neither. To compare platforms, add the plan price, any per-order percentage and gateway fees for a typical month's sales.
Three different charges can come out of every online order, and they are easy to mix up. A gateway fee is what your payment provider charges to process the payment. A platform transaction fee or commission is an extra percentage your store platform or marketplace takes on each sale. A plan price is the fixed amount you pay for the software, whatever you sell. To know what selling online really costs, you need to add up all three for a normal month.
This guide explains each one, shows a worked example on a ₹1,000 order with clearly labelled assumptions, and gives you a simple sheet to compare platforms fairly.
What is a payment gateway fee?
A payment gateway, such as Razorpay, PayU or Cashfree, takes the shopper's UPI, card, net banking or wallet payment and settles the money to your bank. For that service it deducts a fee, usually a percentage of the payment, sometimes with GST on the fee itself. Rates can differ by method: domestic cards, international cards, EMI, wallets and UPI are often priced differently, and some plans have custom rates for larger businesses.
Every online store that takes online payments pays some gateway fee, on any platform. The useful questions are: what is your rate for each method, when does the money reach your bank, and is the fee shown clearly in your dashboard? Check your gateway's current pricing page or your agreement rather than relying on a number you saw somewhere. Our Razorpay setup guide shows where to find these details.
What is a platform transaction fee?
Some store platforms charge a percentage on each order on top of the gateway fee. It may be called a transaction fee, a platform fee or something similar. It is separate from the gateway and you pay it even though the platform is not processing the payment itself.
A well-known example is Shopify. Shopify Payments is not available for businesses in India, so Indian stores use a third-party provider such as Razorpay. Shopify's India pricing page then lists a third-party transaction fee of 2% on Basic, 1% on Grow, 0.6% on Advanced and 0.2% on Plus. (Prices and fees as listed on shopify.com/in/pricing on 20 October 2026; Shopify changes prices and offers from time to time, so check Shopify's current pricing.)
What is commission, and how is it different?
Commission is the word usually used by marketplaces and some selling apps. The platform takes a share of each sale, often varying by category and sometimes combined with fixed closing fees, shipping fees and other charges. Because marketplace fee cards change and differ by category, read the current rate card for your category before you list. Our guide to marketplaces versus your own store looks at the wider trade-off.
From a seller's point of view, platform transaction fees and commission behave the same way: they grow as your sales grow. A fixed plan price does not.
How much do you really pay on a ₹1,000 order?
Here is a worked example. The numbers are assumptions for illustration only. Say your gateway charges 2% on this payment (yours may be different; check your gateway's pricing), and you compare a platform with no commission against one with a 2% third-party transaction fee.
| Charge on a ₹1,000 prepaid order | Platform with no commission | Platform with 2% transaction fee |
|---|---|---|
| Gateway fee (assumed 2%) | ₹20 | ₹20 |
| Platform transaction fee | ₹0 | ₹20 |
| Total per-order fees | ₹20 | ₹40 |
The plan price comes on top, but it is fixed. So the question becomes: over a month, which adds up to less?
A month of sales, side by side
Say you take 150 such orders in a month, ₹1,50,000 in prepaid sales. The 2% platform transaction fee would add ₹3,000 that month. Now add the plan price. As listed on 20 October 2026, Shopify Basic is ₹1,994 a month on monthly billing (the page does not say whether GST is added). UpMinutes Growth is ₹999 a month including 18% GST, with no commission on sales. Gateway fees are the same in both cases if you use the same gateway, so they cancel out in the comparison.
Your numbers will differ. The point is the method: plan price + (sales × platform percentage) + gateway fees + any paid apps. Do the sum with your own figures. The free profit margin calculator helps you see what is left per order after fees.
What other per-order costs should you count?
Fees are only part of the picture. A fair per-order cost also includes:
- Courier charges, plus any COD handling fee your courier charges.
- Returns and refused COD parcels, which cost shipping both ways.
- Packaging: box, filler, tape and any insert.
- Paid apps or plugins billed monthly, which can quietly add up. See how paid apps add up.
- Messaging: WhatsApp Business and SMS are billed by those services on most platforms.
- GST: whether the platform's price includes GST matters when you compare, and you may be able to claim input tax credit if you are registered. Ask your CA.
How does UpMinutes charge?
UpMinutes charges a fixed plan price, and every price includes 18% GST: Starter is ₹500 a month, Growth ₹999 and Pro ₹2,000, or ten months' price for a year. There is no commission on sales and there are no app fees; hosting, HTTPS, updates and backups are included. You connect your own Razorpay account, so payments go to your bank and Razorpay charges its own fees, which you can see in your Razorpay dashboard. Shiprocket, WhatsApp Business and SMS are billed by those services. Full details are on the pricing page.
Which matters more as you grow?
At very low sales, the plan price is the bigger number, so a cheaper plan wins even if it has a per-order fee. As sales grow, a percentage fee grows with them, while a fixed plan does not. Somewhere in between is a crossover point. Work it out for your store:
- Write down your expected monthly online sales, prepaid only (COD is not processed by the gateway).
- Multiply by each platform's transaction fee or commission.
- Add each platform's monthly plan price, noting whether GST is included.
- Add any paid apps you would need for GST invoices, COD rules or reviews.
- Compare the totals. Gateway fees can be left out if you use the same gateway on both.
When is a per-order fee worth paying?
A per-order fee is not automatically bad. It can be worth it if the platform brings you buyers you would not otherwise reach, as marketplaces can, or if it offers something you truly need. Shopify, for example, may suit you better if you sell mainly abroad and need checkout in many currencies, run POS hardware across several shops, rely on a particular app, or have an in-house team building a custom storefront. The full picture is on UpMinutes vs Shopify, and more guides are in the comparisons category.
Frequently asked questions
Do I pay GST on payment gateway fees?
Gateways generally charge GST on their own fee, shown separately on their invoice. If you are GST-registered, ask your CA whether you can claim it as input tax credit.
Is cash on delivery free of gateway fees?
COD orders do not go through your payment gateway, so there is no gateway fee. Your courier usually charges a COD handling fee instead, and refused parcels add return shipping.
Does a platform with no commission make money some other way?
Usually through its plan price. Check what the plan includes, whether apps or extra features are billed separately, and whether the price includes GST.
Why do gateway rates differ between UPI and cards?
Card networks, banks and UPI each have their own pricing rules, and gateways set rates per method. Check your gateway's current rate card for each method you accept.
