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E-Commerce · head to head

Klarna vs Razorpay

Klarna logo

Klarna

E-Commerce

Buy now pay later and instalment checkout for online and in-store merchants

From
On request
Rated
-
Full reviewWebsite
Razorpay logo

Razorpay

E-Commerce

Indian payment gateway for domestic and international card, UPI and wallet acceptance

From
On request
Rated
-
Full reviewWebsite

The short version

  • Each has a real cost: Klarna merchant fees for the short-term products run around 5.99% plus a fixed fee in the United States, roughly double a standard card rate, so unless Klarna measurably lifts average order value or conversion it is a straight margin loss.; Razorpay it requires an Indian legal entity and settles only to Indian bank accounts, so it is not an option for a business incorporated elsewhere no matter how many Indian customers it has.
  • They diverge on capability: Klarna covers Pay in 4, Razorpay covers Domestic payment methods.
  • Prices and features above were last checked on 31 August 2026.

Where they differ

Only the attributes on which Klarna and Razorpay actually diverge.

Attributes where Klarna and Razorpay differ
AttributeKlarnaRazorpay
Pricing modelquotetransaction
PlatformsWeb, iOS, AndroidWeb

Identical on both: starting price (On request), free tier (No), user rating (Not yet rated), category (E-Commerce).

What each one covers

Drawn from each product's published feature list. An absence here means we hold no record of it - not that the product lacks it.

Only in Klarna

  • Pay in 4
  • Pay in 30 days
  • Longer-term financing
  • Klarna app placement
  • Klarna Checkout
  • In-store payments
  • On-site messaging
  • Merchant portal

Only in Razorpay

  • Domestic payment methods
  • International cards
  • Payment links and pages
  • Route
  • RazorpayX
  • Subscriptions
  • Smart Collect
  • Dashboard and reporting

What people use each for

The jobs each tool is most often brought in to do.

Klarna

  • A fashion or furniture retailer with average order values high enough that a 3% fee uplift is repaid by a larger basketnot Razorpay
  • A merchant selling to younger shoppers who have low credit card penetration and would otherwise abandon at checkoutnot Razorpay
  • A European retailer wanting a single hosted checkout that handles instalments, invoice and card in one flownot Razorpay
  • A brand that wants distribution inside Klarna's shopping app as an acquisition channel rather than only a payment optionnot Razorpay

Razorpay

  • An Indian D2C brand needing UPI acceptance alongside cards in a single checkoutnot Klarna
  • An Indian SaaS business billing domestic customers on recurring mandatesnot Klarna
  • A marketplace that must split each payment between the platform and its sellersnot Klarna
  • A business that needs to take payment without building a website, using links and pagesnot Klarna

Where each one falls short

Documented limitations, not opinions. Every one is a constraint you would hit in normal use.

Klarna

  • Merchant fees for the short-term products run around 5.99% plus a fixed fee in the United States, roughly double a standard card rate, so unless Klarna measurably lifts average order value or conversion it is a straight margin loss.
  • Rates are negotiated and unpublished, which means small merchants pay the standard rate while large ones negotiate down, and you cannot benchmark what you are being charged without going to market.
  • Returns and partial refunds are handled through Klarna's systems rather than your payment processor, so your finance team reconciles a second settlement flow and customer service handles a second dispute process.
  • Buy now pay later is being brought under consumer credit regulation in the UK, the EU and Australia, which is already changing affordability checks and disclosures; the checkout experience that converts today may be legally required to add friction.
  • Klarna owns the post-purchase relationship, sending payment reminders and marketing in its own name, so a shopper who has a poor collections experience associates it with your brand while you have no control over the messaging.

Razorpay

  • It requires an Indian legal entity and settles only to Indian bank accounts, so it is not an option for a business incorporated elsewhere no matter how many Indian customers it has.
  • The transaction percentage applies to the full order value including shipping and tax rather than to the product price, so low margin categories with heavy shipping give up more of their margin than the quoted rate suggests.
  • Payment aggregator authorisation sits with the Reserve Bank of India and has been withheld from aggregators before while applications were reviewed, so a dependency exists that no commercial contract term protects you from.
  • Default settlement runs on a delayed cycle with faster settlement sold as a paid add-on, so a business that buys stock from its takings either waits for cash or pays extra for it, and that cost belongs in the effective rate.
  • International card acceptance is priced higher and requires separate approval rather than being a configuration change, so cross-border revenue takes longer to switch on and earns less per order than a domestic sale.

Pricing, plan by plan

Klarna

On request
  • Klarna for Business$undefined/year
    • Per-transaction percentage plus a fixed fee, negotiated by merchant
    • No published rate card; rates vary by market, product and volume
    • Short-term products priced materially above card interchange

Razorpay

On request
  • Domestic Payments$undefined/mo
    • 2% platform fee per successful transaction across all payment instruments
    • GST: 18% applies on the platform fee
    • No setup fees, annual maintenance charges, or refund fees
  • Corporate Cards$undefined/mo
    • 2.15% platform fee per transaction
  • International Payments - Cards$undefined/mo
    • Up to 3% per successful transaction
  • International Payments - Bank Transfers$undefined/mo
    • 1% per transaction with zero forex markup

Which should you pick?

Choose Klarna if

  • You need pay in 4.
  • You work on Web, iOS, Android.
  • You also want pay in 30 days.
Klarna review

Choose Razorpay if

  • You need domestic payment methods.
  • You also want international cards.
Razorpay review

Questions people ask

Is Klarna or Razorpay better?
Neither clearly leads. Klarna starts at On request and Razorpay at On request, and user ratings are close enough to be indistinguishable. Choose on capability and platform support.
Which is cheaper, Klarna or Razorpay?
Klarna starts at On request and Razorpay at On request.
Does Klarna or Razorpay run on more platforms?
Klarna runs on Web, iOS, Android. Razorpay runs on Web.
What is Klarna best used for?
Klarna is most often used for a fashion or furniture retailer with average order values high enough that a 3% fee uplift is repaid by a larger basket, a merchant selling to younger shoppers who have low credit card penetration and would otherwise abandon at checkout, a european retailer wanting a single hosted checkout that handles instalments, invoice and card in one flow, a brand that wants distribution inside klarna's shopping app as an acquisition channel rather than only a payment option. Of those, a fashion or furniture retailer with average order values high enough that a 3% fee uplift is repaid by a larger basket and a merchant selling to younger shoppers who have low credit card penetration and would otherwise abandon at checkout are not what Razorpay is typically brought in for.
What can Klarna do that Razorpay cannot?
Klarna covers Pay in 4, Pay in 30 days, Longer-term financing, Klarna app placement. Razorpay covers Domestic payment methods, International cards, Payment links and pages, Route.

Answered from the vendors’ own pages

Klarna: What does Klarna cost a merchant?

Klarna does not publish a rate card. In the United States most merchants pay around 5.99% plus $0.30 for short-term products, with longer-term financing nearer 3.29% plus $0.30, and large merchants negotiate lower.

Razorpay: Can I use Razorpay if my company is not in India?

No. It requires an Indian entity and an Indian bank account for settlement. Overseas businesses selling into India need a different arrangement.

Klarna: Does the merchant carry the credit risk?

No. Klarna pays the merchant the full amount less fees and takes the risk of the shopper not paying.

Razorpay: What is the real effective rate?

The domestic percentage on the full order value including shipping and tax, plus higher international rates, plus any charge for faster settlement and dispute handling. Compute it from a month of settlement reports, not the pricing page.

Klarna: Can I use Klarna alongside my existing processor?

Yes. It is normally added as an additional payment method through Shopify, Adyen, Stripe or a direct integration rather than replacing your card acquirer.

Razorpay: How quickly do I get paid?

On a delayed settlement cycle by default, with faster settlement available as a paid feature. Plan working capital around the default, not the add-on.

Klarna: Is Klarna still independent?

Yes. It listed on the New York Stock Exchange in September 2025 and holds a Swedish banking licence.

Razorpay: What is the main structural risk?

Regulatory. Indian payment aggregators operate under RBI authorisation and have previously been barred from onboarding new merchants. Keep a second processor integrated if payments are business-critical.

Razorpay: Does it support recurring billing?

Yes, built on India's mandate and e-mandate framework, which has its own rules on authentication and notification that differ from card-on-file recurring elsewhere.

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