Stripe has halted their on-boarding process in India! What are the alternative payment gateways for SaaS companies now?

When Stripe announced that from May 2024 they are switching to invite only in India, I was completely shocked because I was(still) building Lipy - India’s local commerce app. which is a customer service platform and we wanted to sell our product internationally, same as other SaaS businesses in India.

My hunt for alternative payment gateway begins (Domestic Market):

I started scanning the web looking for better alternatives in India and found a few gateways which also promised international payments.

1. Razorpay: 2% - 3.5% fees per transaction.

2. Cashfree: 1.95% - 2.95% fees per transaction.

3. PayU: 2% - 3% fees per transaction.

(Don’t forget 18% GST was applicable on each platform, Indian taxation 😁)

Above three we found the most promising and reliable gateways. They all had multiple payment methods but card and UPI payments were my primary requirement and they also claimed support for international payments.

So I started applying for each service:

First I applied for Razorpay and they were quick and I got in touch with one of their onboarding representatives and provided necessary information and my account was activated within a few days.

I started exploring the platform and I noticed their UI was cluttered and wasn’t a smooth experience for me atleast or maybe I was a bit spoiled by Stripe’s UI. After some struggle and understanding documentation I managed to integrate the payment gateway to Lipy AI. UPI and domestic card payments were working perfectly.

Simultaneously I applied for PayU and Cashfree, I was somehow not able to onboard PayU but managed to onboard Cashfree after struggle and multiple emails.

So I started testing cashfree and found out their dashboard feels glitchy with unwanted redirects / broken links, plus you have to apply again for each payment method you want to use which was again a headache for me. I tried applying for a few and I was getting bombarded with many duplicate emails like “We have activated your payment gateway” but still wasn’t able to access those payment methods later somehow I started getting access to those features but Subscription payments feature was not activated, Which was a bummer for me so I eventually gave up with this platform.

Just took a look after 3 months and still “subscription payment feature access” is under process? 😂

So my conclusion was Razorpay is best for domestic payments and has almost similar API to stripe. Fun Fact: Razorpay and Stripe both were Y-combinator backed startups so I guess that might be a reason for the same so much resemblance. ***

So you might ask what about International payments?

Most SaaS businesses want to scale globally and that’s the beauty of SaaS. You can be from any part of the world and still sell your products globally with less hassle.

But for an Indian Saaster like me there’s another problem to tackle; International payments. So I begin my voyage and started scouting international waters.

As I previously mentioned, domestic payment gateways like Razorpay have an option to opt in for international payment. So I applied on Razorpay and the application was REJECTED. Tried with Cashfree same REJECTED.

So I started exploring other gateways Wise, Payoneer, Square were few of them. I rejected Wise although I had good experience with it because it’s not a full fledged payment gateway.

I rejected Payoneer because I wasn’t able to convince myself to use it due to multiple factors and confusion around developer experience.

Square looked so promising but I felt it was targeted towards ecommerce businesses and less towards SaaS. Still I gathered some courage and optimism and contacted their customer support. I was informed that “Square isn’t available in India”.

I even connected with Stripe executives via call and informed them that we are a private limited company who wants to use Stripe to sell our SaaS internationally, though the representative was helpful. She filled out a form and forwarded it to their sales team, and they Rejected me again!

After facing all those rejections I was completely saddened and thought let’s shift my focus towards the domestic market and stopped thinking about selling in international markets.

But something happened. I watched a video on Theo’s youtube channel titled “Stripe Just Made An Unexpected Acquisition” and I got to know Lemon Squeezy which was acquired by Stripe.

I went to their website and found out there were all-in-one payment gateway platforms for Ecommerce & SaaS businesses. Few things I noticed are as below:

• Borderless Payments, Subscriptions, Global tax compliance, Multi-currency support.

• Failed payment recovery, AI fraud prevention
• Built in Affiliate program
• Email List & Marketing

It was a new ray of hope for me, but there’s a catch: they charge 5% + 50 cents behind each transaction whereas; Stripe fees are 3% + 30 cents per transaction.

But still having Affiliate program + Global tax compliance which Stripe lacks, is totally worth paying that 5% cut according to me.

I have signed up and currently started the onboarding process but I am quite optimistic about this platform. ***

Final Thoughts:

I am still testing Lemon Squeezy and haven’t fully integrated with www.lipy.ai yet but it’s quite promising if you want to sell internationally without compromising compliances of each country plus you get built in Affiliate program feature.

My approach will be bit different I am thinking to use some hybrid mechanism where I can display Razorpay gateway to Indian customers due to UPI payment support and for international customers will be switching to Lemon Squeezy. I haven’t finalize this approach too because I want to integrate affiliate program too.

I will keep posting updates regarding this.