B2B Payment Methods in India

Due to digital disruption happening in India, the businesses in India started to adapt to digital technologies and started to adopt the recent trend in online payment methods. Due to the reformations and restrictions on cash economy by the NDA government, there was a rapid growth in the digital economy in terms of B2B payments as well. Still, offline methods in India are traditional methods of B2B payments. Few common methods of B2B payments used in India are:


Paying by cheque is widely used payment method in India with respect to B2B payments. A cheque is a document provided by the payer to the payee with the details of the amount to be paid, on which date, and the name of the payee organization. The cheque authorizes payer's bank to pay the specified amount of money from payer's account to the payee account or paid in cash. The person who writes the cheque, usually the payee, has a banking account for the transaction (usually called a current, cheque, chequing account) where their money is held and transferred.

Bank Transfers

The payee includes his bank account number and IFSC code in the invoice and the payer either transfers the money from his bank with a transfer challan or just pay through online banking with NEFT or IMPS.

Demand drafts

For making sophisticated payments to government organizations and educational institutions, a demand draft is used. Demand draft is a prepaid mechanism, where you pay the bank and get a demand draft for the amount you paid to the bank. The bank provides the demand draft with the details of whom the amount has to be paid. The payee can take the demand draft, and give it to his bank and get the money deposited to their bank account. In cheque, as there is a disadvantage of bouncing, organizations stick to demand draft.

Third-party gateways

Business with high margins and consumer facing and semi consumer-facing use payment gateways to receive payments. These payment gateways have the capability to accept payments using net banking with 2-factor authentication, credit and debit card processing, wallet processing etc.

Some of the widely used payment gateways in the business environment are:

  • PAYU
  • RazorPay
  • Bank Based Payment Gateways
  • RazorPay
  • Payzapp (By HDFC bank)


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