Payment acceptance options compared: QR, soundbox, POS, tap-on-phone and gateway
How the main ways of accepting digital payments in India differ in cost structure, set-up and fit.
This table compares types of acceptance set-ups, not providers. It shows how each one usually charges, what it suits and what to watch. There are no prices or rankings here: rates depend on your offer, sales mix and date, and the right choice depends on your ticket sizes, channel and cash flow. Shortlist a type here, then compare written offers with the offer comparison checklist and the MDR fee calculator.
Select a column header to sort.
| Set-up | How it usually charges | Tends to fit | Watch out for |
|---|---|---|---|
| Static UPI QR in a personal or small-merchant (P2PM) account | No charge to you or the customer; P2PM status depends on inward UPI credits staying within about ₹1 lakh a month | Street vendors, very small shops, home businesses | Moved to the P2M category if inward UPI credits exceed ₹1 lakh a month for three months in a row; no card acceptance |
| Merchant UPI QR from a bank or aggregator | No charge up to ₹2,000; select payments above ₹2,000 to carry 0.4% MDR (cap ₹300) once NPCI implements it | Shops, restaurants and services taking mainly UPI | Settlement terms, account fees, how the UPI MDR will be shown on statements |
| Soundbox (audio payment confirmation) | Monthly rental or one-time purchase, sometimes waived above a sales target; UPI charges as above | Busy counters where staff cannot check every phone screen | Rental that continues after you stop using it, SIM charges, device return terms |
| Card terminal (POS), rented | MDR per card type plus monthly rental, often waived above a sales target; UPI on the same device | Shops with regular card customers or higher ticket sizes | Blended rates, rental if you miss the target, minimum monthly fees, lock-in |
| Card terminal (POS), purchased | Upfront price plus MDR; maintenance or SIM charges may remain | Stable businesses that will stay with one acquirer for years | Device locked to one acquirer, repair turnaround, payback longer than expected |
| Tap-on-phone or mPOS (phone as terminal) | MDR per card type; low or no device cost | Home services, delivery, field sales, pop-up stalls | Limits on contactless amounts without PIN, phone compatibility, battery and data |
| Online payment gateway (payment aggregator) | Percentage per method, sometimes plus a fixed fee; higher rates for international, corporate and some EMI | Websites, apps and online stores | Refund and chargeback fees, settlement holds, rolling reserves, renewal of custom pricing |
| Payment links and invoices | Gateway rates per method | Service firms, B2B invoices, social-media sellers | Link misuse, customer confusion with fake links, reconciliation |
| Credit card or credit line on UPI | Card or credit product MDR, not the UPI rule | Merchants whose customers want to pay by credit through UPI | Higher cost than ordinary UPI; check whether your QR accepts it and what you are charged |
Caveats. The ₹2,000 threshold, 0.4% rate, ₹300 cap and ₹1 lakh P2PM limit come from the Department of Financial Services/NPCI FAQ on MDR on select UPI P2M transactions dated 15 September 2026. NPCI announced on 13 October 2026 that the UPI MDR will be implemented after Diwali on a date to be notified, so check whether it has started. The zero charge on RuPay debit cards and on UPI up to ₹2,000 comes from notification S.O. 5067(E) of 14 September 2026 under section 10A of the Payment and Settlement Systems Act, 2007.
Official sources: Reserve Bank of India for the Master Direction on Payment Aggregators and card rules, NPCI for UPI circulars and press releases, Department of Financial Services for the section 10A notification and FAQs, and CBIC GST for GST on fees.