Razorpay From Sign-Up to Salary Day

Chapter 1

The Morning You Decide to Accept Payments Online

A shop owner who has sold offline for a decade signs up for Razorpay on a Tuesday, hoping to start taking card payments by the weekend. What happens between clicking Sign Up and seeing the word activated on the dashboard depends almost entirely on one choice made in the first five minutes, and most people never realise they are making it.

The choice is which KYC path to take. If the business already holds records with a bank, mutual fund or insurer under India's Central KYC Registry, entering the business PAN and date of incorporation lets Razorpay auto-fetch most of the required documents and skip Video KYC altogether — account activation can then happen in minutes rather than days. Where no CKYC record exists, the traditional path applies: document uploads, and for individual or unregistered businesses, a live Video KYC call where the original PAN card has to be shown on camera.

Either way, the account moves through a small set of states: under_review while the team checks what was submitted, needs_clarification if something is unclear, and eventually activated, suspended or rejected. A rejected account is not a dead end — a new account can be created with corrected KYC details, using the same mobile number if it is not already linked to two other, different email addresses.

That last detail matters more than it looks. Razorpay's Multi-Account feature lets one person run several businesses under the same mobile number and email — useful for someone operating two separate brands — but the moment that number is already tied to two different emails, a third account cannot be created that way. The business owner in that position has to use a different number or sign up by email instead.

For anyone who would rather not manage the document chase personally, Assisted Onboarding is a paid add-on: a dedicated onboarding manager handles everything from KYC submission to activation, for a fee on top of the standard process. It is not the default path, and nothing about signing up nudges a business toward it — it has to be requested.

Once the account is activated, the shop owner from the opening line is no longer thinking about paperwork. They are thinking about the first sale — which is where a completely different set of decisions begins.

What you can actually do here

Razorpay is really three different jobs wearing one login: getting money in, getting money out, and staying compliant while it moves. Here is where each of those lives.

Getting set up

Getting paid

Getting money out, and staying compliant

Chapter 2

Which Papers You Actually Need, and Why the List Changes

The documents Razorpay asks for are not one fixed list — they change with the legal shape of the business, and a business owner who assumes their neighbour's paperwork applies to them usually loses a day finding out otherwise.

Razorpay recognises a wide spread of business types: sole proprietorships (a local shop, a freelance designer), partnerships (law firms, physician groups), LLPs (auditing firms, consultancies), private and public limited companies, trusts, HUFs, government entities, judicial persons, local authorities, Section 8 non-profits, societies, and individuals running an unregistered business. Each one carries its own KYC document set, and the platform's own tip is worth repeating exactly as it states it: the PAN card and the address proof used for KYC — Aadhaar or passport — must belong to the same authorised signatory.

Beyond the base KYC set, certain lines of business trigger an additional certificate before the account can go live. A health-supplement seller needs FSSAI or AYUSH documentation. A stock-market advisory firm needs a SEBI certificate in the business's name — or, for a sole proprietorship, in the proprietor's own name. A forex business needs FEMA registration and an FFMC certificate. Gold, silver, platinum and gemstone sellers each need their own hallmark or grading certification. An insurance broker needs an IRDAI registration matched to the specific line — life, general or health.

This is where a business that assumed 'KYC is KYC' gets stuck. A jewellery business submitting only the standard proprietorship documents will sit in needs_clarification until the hallmark certificate is added — not because anything was done wrong, but because the category itself carries an extra requirement that the base document list never mentions.

The practical response is to check the additional-certificate list for your specific product category before starting KYC, not after landing in a clarification loop. Once the right documents are matched to the right business type, the account moves to activated and the actual work — taking a payment — can begin.

Chapter 3

Turning a One-Time Sale Into a Standing Order

A software company charging customers once a month does not want to manually invoice every one of them on the first of the month forever. That is the exact problem Subscriptions is built to remove, and it does more than simply repeat a charge — it tracks quantity, duration, plan changes and what happens when a card fails, as one connected system.

A Subscription is built from a Plan — an amount and a billing frequency — and then layered with quantity (how many units, seats or licenses are being charged per cycle) and a total count (how many cycles the Subscription runs for). Any of the plan, the quantity, the total count, the start date, or the linked offer can be updated later, but only while the Subscription sits in the authenticated or active state; one in the created, pending or halted state cannot be touched.

Updates can take effect immediately or at the end of the current cycle. An immediate update usually means either charging the customer an extra amount — moving them to a bigger plan mid-month — or refunding them via a credit note when they downgrade. Razorpay's own worked example shows this cleanly: a customer on a ₹300 monthly plan for one seat moves, on day one of the cycle, to a ₹150 plan for two seats. Because the per-day cost works out the same on both sides — ₹10 a day either way — nothing is charged and nothing is refunded. The maths only produces a real charge or refund when the per-day value genuinely changes.

There is one hard floor on this: if the prorated difference between the old and new plan works out to less than fifty paise, Razorpay will not process the update at all. It is a small rule, and it is exactly the kind of thing that causes a confusing error message the first time a business tries to test an update with two near-identical plans.

A downgrade refund is issued as a credit note rather than against any single invoice — one credit note covers the whole value returned, even if multiple invoices were involved, and it is refunded automatically once it moves from created to refunded. None of this requires a support ticket; it is what the update API and dashboard action already do on their own.

Getting the billing right is only half the job, though. The other half is what happens the month a card simply does not charge — which is where a Subscription's real test begins.

Chapter 4

When a Payment Fails and What Happens Next

A customer's card expires two days before their subscription is due to renew. Nothing about their intent to keep paying has changed — but from Razorpay's side, this looks identical to a customer who has decided to walk away, until the retry logic runs its course.

When a recurring charge fails — an expired card, a blocked card, insufficient balance, a mandate the customer cancelled — the Subscription moves to the pending state and a retry is attempted automatically the following day. If the customer updates their card while in this state, the last invoice is charged against the new card; success moves the Subscription back to active. If every retry is exhausted without success, the Subscription moves to halted, and from there it only recovers if the customer manually updates their card or the business manually charges the outstanding invoice.

There is a specific pattern worth knowing before it causes a false alarm: a payment.failed webhook followed shortly by a payment.captured webhook for the same transaction. This is not a bug and not double-billing. It usually happens because a customer's UPI app — PhonePe, Google Pay — lets them retry a failed attempt (wrong PIN, low balance) immediately inside the same app session. Razorpay reports the first failure honestly, then reports the successful retry as its own event. A reconciliation process that treats every payment.failed webhook as final will misreport revenue it actually collected.

Disputes work on a separate track entirely. When a customer's issuing bank challenges a payment — claiming it was unauthorised, or that goods were never delivered — the dispute enters the created state. Contesting it moves it to under_review once evidence is submitted; if that evidence is insufficient, unreadable, or does not match the contested amount, it is bounced back as action_required rather than simply rejected outright, which at least tells the business what to fix rather than leaving them guessing.

Handled well, none of this needs a human watching a dashboard all day — webhooks report every state change the moment it happens. Handled badly, a business finds out its subscription revenue was quietly draining away only when the monthly total looks wrong.

Chapter 5

Sending Money Out, and What To Do When the Bank Doesn't Answer

A finance manager runs a vendor payout batch on a Friday afternoon and half the requests come back with a 5xx error. The instinct is to hit retry immediately and repeatedly — which is exactly the instinct that causes duplicate payouts, unless one specific rule is followed first.

Every payout carries an idempotency key. When a 5xx error or timeout occurs, the retry must reuse that exact key and send the identical request body — a different body against the same key is rejected outright as a bad request. Followed correctly, Razorpay guarantees the underlying payout is never processed twice, even if it genuinely completed on the first, failed-looking attempt.

The documented retry schedule is specific: retry after one minute, then two minutes, then five minutes — three attempts in total. If none succeed, the instruction is to stop retrying and wait at least one hour before treating the payout as failed. In parallel, the payout's status can be checked directly using the reference_id passed in the original request, via the fetch-all-payouts endpoint, for up to an hour after creation — useful for a business that does not want to rely on a webhook arriving.

Beyond server errors, a payout moves through its own set of named states worth recognising on sight: pending (awaiting approval), queued (insufficient funds, or the destination bank or NPCI is down — applicable to RazorpayX Lite), initiated, processed, reversed (money bounced back to the sender), and failed. Two downtime events — payout.downtime.started and payout.downtime.resolved — exist specifically so a business does not fire payouts into a bank that is known to be down at that moment; UPI is the one mode this particular downtime webhook does not cover.

None of this replaces having a human check things occasionally, but it does mean a payout batch that comes back with errors on a Friday afternoon has a documented, calm path through it rather than a guess.

Chapter 6

Getting Paid From Outside India

An Indian software company lands its first customer in Germany and realises, mid-negotiation, that its payment page has never taken anything but rupees. Razorpay's international payments support covers this from both directions — an Indian business selling abroad, and a foreign business selling to Indian customers — and the two paths are built quite differently.

For an Indian business, international acceptance covers more than 160 foreign currencies through the standard Payment Gateway, Payment Pages, Payment Buttons, Payment Links and Invoices, with 3D Secure 2.0 support for international cards. New Razorpay users and existing ones both have a route to activate it; separately, Indian businesses can open an International Bank Transfer account — sometimes called a MoneySaver Export Account — which supports Local Currency Bank Transfer and SWIFT Transfer, letting overseas buyers pay through their own local bank rails while the business is settled in INR without extra paperwork on either side.

The reverse case is less obvious and easy to miss entirely: a non-Indian business can accept payments from Indian customers — via cards, UPI and netbanking — and settle the proceeds into its own overseas bank account, without registering in India at all. This is explicitly stated as an on-demand feature activated through a request form, not something that appears automatically on sign-up, which is exactly why most foreign businesses never realise it exists.

One operational detail worth flagging before it causes a lost sale: an international payment fails outright if a dummy email address or phone number is submitted for the customer. It is stated plainly, and it is the kind of thing a business only discovers after a real customer's payment silently does not go through.

Between the two directions — selling out, and being sold to — a business now has coverage on both sides of a cross-border transaction. What remains, for most businesses of any size, is the domestic obligation that never goes away: paying their own people correctly, on time, and within the law.

Chapter 7

Running Payroll Without Becoming a Compliance Officer

A ten-person startup's founder spends the last Friday of every month manually calculating PF, ESI, professional tax and TDS for each employee, terrified of getting one number wrong. This is precisely the workload RazorpayX Payroll is built to absorb — automating four separate statutory payments from one execution, rather than four separate manual processes.

Provident Fund is the one most businesses meet first: it is a joint contribution, with the employer required to add 12% of an employee's basic salary and dearness allowance, and it is mandatory to include as part of every employee's CTC. Payroll's default is to calculate PF on all wages except HRA, though this can be changed in settings — with the platform stating plainly that it is not responsible for compliance issues that follow from changing that default. A ₹15,000 wage ceiling option is also available for PF calculation, matching how many organisations structure their contribution policy.

Professional Tax has a specific wrinkle worth knowing before it causes a missed deadline: since Karnataka introduced two-factor authentication on its PT portal in September 2024, Payroll cannot automate PT payments for Karnataka-based employees at all — these must be made manually through the e-Prerana portal, in a documented three-step process (file the e-return, make the e-payment, submit returns). TDS and ESIC continue to be automated as normal for the same employees; only Karnataka PT sits outside automation.

Compliance due dates follow a fixed monthly rhythm: TDS by the 7th of the following month (the 30th of April specifically for March), PF by the 15th, ESI by the 7th, and PT somewhere between the 15th and the 31st depending on the state's own filing frequency. One limit is worth stating clearly, because it is easy to assume otherwise: Payroll makes these payments and files these returns, but it does not handle a company's initial registration for PF, ESI or PT — that groundwork has to be done separately, through a CA partner, before Payroll can take over the ongoing payments.

Employee loans sit in the same dashboard and follow their own logic. A loan can carry a flat or reducing interest rate, and the tax treatment depends on a perquisite percentage — the gap between what SBI itself charges for a comparable loan product and what the organisation charges its employee. If SBI's personal loan rate is 13% and the organisation charges 8%, the 5% gap is treated as perquisite income and taxed under the employee's chosen regime. Setting this correctly means checking SBI's own published rate for the matching loan category, not guessing at a round number.

And for the one situation every payroll admin eventually hits — an employee leaving mid-month and needing their final settlement immediately — Payroll allows a single employee's payroll to be executed on its own, pausing everyone else's salary for that run via Skip All Except This, with the rest of the team simply resumed afterward. It is a narrow, specific feature, filed inside an edit menu rather than presented as its own headline capability.

Chapter 8

Where Razorpay Stops, and What You Still Have To Do Yourself

A business that has been through onboarding, set up subscriptions, connected payouts and automated payroll can start to assume the platform handles everything financial about running the company. It does not, and the gaps are specific enough to plan around rather than discover mid-crisis.

Payroll pays and files compliance dues; it does not register an organisation with PF, ESI or PT authorities for the first time. That initial registration is explicitly outside its scope, and the platform's own guidance points businesses to CA partners for it. Similarly, Payroll does not file nil returns — if there is nothing to report for a month, no return is filed on the business's behalf, which means someone still has to know whether a nil return was ever legally required in the first place.

Karnataka's Professional Tax has moved entirely outside automation since the state's PT portal added two-factor authentication in September 2024 — a business with Karnataka-based employees now carries a manual monthly task that automation elsewhere on the dashboard may make easy to forget.

Assisted Onboarding, the paid KYC concierge service, is not a fallback that activates automatically when a KYC submission stalls — it has to be actively chosen and paid for; a business that assumes help will arrive if things go wrong will simply sit in needs_clarification instead.

On the hardware side, DigiPOS is scoped narrowly to Apple Premium Resellers taking in-store payments on iPhones and iPads — a retail business outside that specific category is looking at the wrong product entirely. And the biometric attendance integration explicitly does not support every device on the market — the F31 Facebot and RSP10i9 are the recommended models, and the i32 Macronium is stated outright as incompatible.

None of these are flaws so much as edges — the places where a platform that automates an enormous amount of financial administration still hands the last, human decision back to the business. Knowing where those edges sit in advance is the difference between a smooth first quarter and a scramble in week two.

Questions readers actually ask

Contact / More useful information from RamthaMedia

Official source links:
Razorpay