Technology Trends

Razorpay: A Story of Firsts

Nope. We are still sticking to our theme of fintech. This is not about some razors that would help you shave. But yes, it is no less sharp. Razorpay and it’s cutting edge technology is leading the fintech ecosystem in our country. Before we proceed further, let’s understand what does Razorpay do. In simple words, it is a payment gateway. Oversimplified version: Payment gateway is a piece of software that acts as a bridge between vendor and the customer whenever one is trying to make payment online. In case you really wish to appreciate payment gateways, here’s an article I wrote recently.

Back to Razorpay. So this fintech startup was found back in 2013 by two IITians Shashank Kumar and Harshil Mathur. These two gentlemen were building a crowdsourcing platform at that time. That’s when they realized that online payment infrastructure is in a bad shape for startups and MSMEs. It is not easily accessible to someone who is just starting up or is low on budget. This was also the time when our consumption patterns were undergoing a dramatic shift. We were moving online, fast. Therefore, every new/small business needed to have this service.

Foreseeing this opportunity, Razorpay launched it’s payment gateway in March 2014. Focused specifically on startups and SMEs.

The Story of Firsts:

Interesting piece in the story of Razorpay is that it has so many firsts to it’s name. I am sure you all must have used the features I am going to list but never acknowledged the likes of Razorpay for it. Let’s explore these features:

1. UPI

Yup. That cool zip zap zoom mode of payment that seeks a 6 digit PIN to authenticate the payment and bring your Pizza one step closer to you. This payment method was not a part of payment gateways earlier. Those were the times when you put card details, expiry date, CVV number and an OTP for completion of the payment. Razorpay was the first Indian payment gateway to enable UPI payments.

If you are still thinking that it is not that big of deal, get this. UPI payments grew by 885% in India from 2018 to 2019.

In 2019, UPI exceeded its previous contribution at 38%, eating into cards’ share while credit and debit cards collectively contributed 46%

UPI overhauled Net Banking, cards, and other digital payments in September 2019, becoming the most preferred payment mode in India for the very first time.

2. Zero Transaction Fees on Debit Cards on Razorpay:

As an excerpt from the article from November 24th, 2016 notes:

Razorpay, an online payments platform, announced that it is waiving off all service charges on Debit Card transactions for all of its 10,000+ merchants, from 12 PM on Nov 24 till December 31, 2016. This move is aimed at helping businesses affected by demonetization and encourage users to transact online. While some banks are still deciding upon the waiver proposed by RBI, Razorpay has taken initiative and is the first payment gateway to remove all charges for debit cards.

A little more perspective on this move. Banks charge certain fees to enable card payments from the business owner. In turn, the owner may pass on these charges to you (in case of low margin products). Post demonetization, Razorpay decided to absorb these charges themselves. Even before banks decided to waive of these costs, Razorpay announced this news for its merchants.

“Though we have not received confirmation regarding the waiver from all our partner banks, we have decided to launch zero transaction cost for debit cards across all our merchants. We acknowledge and support the effort by RBI to promote online transactions. This move fits in perfectly well in the long term vision of a Digital India and will incentivize merchants to go cashless.” said Harshil Mathur, CEO & Co-Founder, Razorpay”

3. First Indian Fintech offering end-to-end Payment Solutions

In September 2017, Razorpay evolved from a fintech platform to an end to end solution for the merchants. This means that apart from just helping businesses get payments online, Razorpay now helped them with the entire flow of the money. They achieved this through following products:

  • Razorpay Route provides an end to end solution to manage marketplaces, payments that need to be split in different ratios and payouts from other vendors.
  • Imagine collecting all the business payments in an account which also used for other inflows and expenses. It’s a reconciliation nightmare right? Razorpay Smart Collect helps businesses setup a virtual account so that all online payments can stay separate.
  • Razorpay Subscriptions helps merchants manage a subscription based business. It helps manage scheduled payments, create different pricing plans and track all payment activity from a single subscriptions platform
  • Even amidst this revolution, not every business is online. So, Razorpay invoices and payment links collects payments for businesses that do not have website or an app.

4. UPI Autopay:

Have you ever subscribed to an OTT plan, monthly insurance premium, audible etc.? If yes, you must be aware that enabling auto-pay requires a credit card. However, with UPI autopay, you can do this directly from your account instead.

So, if you are a subscription based business, now you can also target customers without a card.

All the features like reminders, notifications on SMS, mails are a part of this package itself.

UPI cross 1.3bn payments in 2020. Therefore, UPI autopay has a huge potential of blowing up.

Razorpay became the first company to launch such a service in India. This happened in July 2020.


The result of these ground breaking innovations is evident in the valuation of the fintech platform. Razorpay became a unicorn 6 months ago. Just after that, Razorpay raised $160M from sequoia at a valuation of $3bn. Crazy ride!

What are your thoughts about it?

Got questions? Want to take it to the next level? Reach out to me using your preferred platform from the links below

Until next time..

This Blogpost is in association with blogchatter’s #BlogchatterA2ZChallenge.

A techno manager by profession and a hardcore geek at heart. I love to poke my nose into tasks where other usually gave up on. My hobbies include, reading about Blockchain, Cryptocurrency and latest trends in tech industry, playing guitar and yes, memes!

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