Razorpay Account Activation: Documents, Website Checks and Rejections
Most stuck Razorpay applications come down to the wrong business type, one missing document or a website that fails the checks. All are fixable before you submit.
In this post · 8 sections
You sign up on Razorpay on a Sunday, the test checkout works, and you share the store link on Instagram. On Wednesday the dashboard says needs clarification, live API keys are still locked, and the first ₹4,000 of orders is sitting nowhere useful.
Almost every stuck application traces back to one of four things: the wrong business type, one business document where Razorpay now wants two, a website that fails the automatic checks, or a product category Razorpay does not support. All four can be fixed before you press submit.
Key takeaways
- Choose your business type carefully. Razorpay says you cannot change it once the account is created, only while KYC is still unsubmitted.
- GST is not mandatory. Unregistered individuals can activate with PAN, Aadhaar/DigiLocker and a savings account; proprietorships now need two business documents.
- Policy pages are no longer checked at KYC, but your website still goes through automatic checks before you get live API keys.
- Standard pricing is a 2% platform fee on domestic payments (UPI included), up to 3% on international cards, plus 18% GST on the fee.
- Default domestic settlement in Razorpay's docs is T+2 working days; instant settlement costs extra and the fee is shown in your dashboard.
Step one: pick the right business type
This is the mistake that costs the most time, because it is the one you cannot edit later. Razorpay's account FAQ is blunt: you cannot change the business type once the account is created. If you picked the wrong one, you are looking at a fresh application.
For most small sellers the choice is between two options:
- Individual/Unregistered. Razorpay's examples are freelancers, influencers, professionals and small offline stores that are not formally registered. If you sell under your own name with no GST, Udyam or shop licence, this is you.
- Sole proprietorship. Pick this only if you already hold at least two of the business documents in the table below. Choosing it with nothing to prove the business exists is a common way to land in needs clarification.
Partnerships, LLPs and companies should register as exactly what their PAN says; Razorpay looks them up by business PAN and date of incorporation.
Do you need GST? Razorpay's FAQ says submitting GST and current account details is not mandatory for a very small, new business: you can select "I don't have GST" and use a savings account. Your GST obligations as a seller are a separate question for your accountant.
Documents by business type
Razorpay moved to new "Master KYC" requirements from 1 January 2026. The changes that hit small sellers: proprietorships now need two business documents (previously a GSTIN alone was enough), and companies must add their MOA, AOA, a board resolution or power of attorney, and a beneficial-owner declaration. This table summarises Razorpay's KYC documents page as of October 2026.
| Business type | Business proof | Owner / signatory proof | Bank |
|---|---|---|---|
| Individual / Unregistered | None | Auto-fetched from CKYC; if that fails, PAN, mobile number, and DigiLocker or Aadhaar/passport copy | Account number + IFSC (savings is fine) |
| Sole proprietorship | Any 2 of: Udyam (MSME) certificate, GST certificate, Shop & Establishment certificate, Import Export Code, postpaid mobile bill | Proprietor's PAN + Aadhaar, voter ID or passport | Account number + IFSC |
| Partnership | Partnership deed (+ registration certificate if registered), business PAN | Signatory PAN and address proof, power of attorney, declaration of partners holding over 10% | Account number + IFSC |
| LLP | Certificate of incorporation / LLPIN / LLP deed, LLP PAN | Same as partnership | Account number + IFSC |
| Private limited | Auto-fetched from CKYC; if that fails, certificate of incorporation, CIN, MOA and AOA; business PAN | Signatory PAN and address proof, board resolution or POA, beneficial-owner declaration (over 10% holders) | Account number + IFSC |
If bank verification fails for any type, Razorpay asks for a video of a cancelled cheque. Razorpay's onboarding guide also says, for proprietorships, that at least one of the two documents should be GST or Udyam.
Some categories need an extra licence whatever the business type: FSSAI for food, AYUSH or drug licences for herbal and OTC products, BIS hallmark for gold, among others on the same page. Have it ready before you apply.
The fast path: CKYC
If you already have a Central KYC record (most people who have opened a bank account, mutual fund or insurance policy do), Razorpay's setup guide says it can fetch your documents with your PAN and an OTP and skip video KYC entirely, with activation "in minutes instead of days".
Without a CKYC record you go the long way: upload documents, complete video KYC, finish DigiLocker verification within three days of the call, then wait for a review that Razorpay puts at 3 to 4 business days.
The website checks
A lot of older advice says Razorpay rejects you for missing policy pages. That changed: the Master KYC FAQ lists "Website policies (Terms, Refund, Privacy)" under requirements removed from onboarding.
The pages still matter, just at a different step. Razorpay's website details page says that without live website or app details you cannot get live mode API keys, which means no checkout on your own store. You can still collect money through Payment Links and Invoices from the dashboard in the meantime.
When you add your primary website, Razorpay runs instant checks on the site, its policy pages and your business industry. It asks for links to:
- About us
- Contact us
- Pricing details
- Terms and conditions
- Privacy policy
- Refund (or cancellation and refund) policy
You also upload a sample invoice and, if buyers must log in before paying, test account credentials. If a check fails, the dashboard lets you correct the URLs or generate policy pages through Razorpay.
Beyond the page list, these details make a store look real to a reviewer:
- Prices in ₹ visible on product pages, not "DM for price".
- A contact page with a working email, phone number and address, ideally matching your KYC.
- A refund policy with actual timelines ("refunds processed within 7 days of receiving the return"), not a vague promise.
- Products that match the category you declared. Razorpay's terms allow suspension if you materially change what you sell without permission.
Why applications get rejected
Razorpay's own FAQ gives one headline reason for rejection: it does not support your business sub-category. The prohibited list sits in clause 17 of its terms of use. The entries that trip up small online sellers most often:
- Alcohol, and tobacco and cigarettes
- Counterfeit or replica goods ("first copy" bags, shoes and watches)
- Drugs and drug paraphernalia, which Razorpay says includes herbal drugs
- "Miracle cures" and unsubstantiated health claims
- Adult products, gambling, weapons, and cryptocurrency or NFTs
Other common outcomes are softer. A missing FSSAI licence for a food business, a PAN and address proof belonging to different people (Razorpay says they must match), or a failed video KYC usually lead to needs clarification, which you answer from the dashboard. A full rejected status means starting a new account with correct details.
Activation is not the finish line either. Razorpay says compliance teams and partner banks run routine audits after activation and may pause settlements while they do. You can keep taking payments, and Razorpay says it re-enables settlements within 2 days of receiving your response.
What Razorpay costs once you are live
Razorpay's pricing page and its published India rate card (last updated May 2026) list a flat platform fee across domestic instruments:
| Payment method | Platform fee per successful payment |
|---|---|
| UPI, RuPay debit, domestic debit and credit cards (incl. Amex and Diners), netbanking, wallets, Pay Later, EMI | 2% |
| Corporate / business credit cards | 2.15% |
| International cards | Up to 3% |
| GST | 18% on the fee, not on the sale |
| Setup, annual maintenance, refunds | ₹0 (instant refunds ₹7.99 to ₹14.99 each) |
The UPI line surprises people. UPI and RuPay debit carry zero MDR under government policy, and Razorpay says so, but it still charges its 2% as a platform fee. So a UPI payment through Razorpay costs you the same as a card payment. That is the main reason sellers keep a direct UPI option, which has its own trade-offs covered in direct UPI vs a payment gateway.
When we checked in October 2026, the pricing page was also advertising a 0% fee for the first 90 days for new sign-ups. Read the eligibility terms before you count on it.
Worked example: ₹1,00,000 of monthly sales
Say your prepaid orders in a month add up to ₹1,00,000, split like this (COD orders never touch the gateway, so leave them out):
| Method | Sales | Rate | Fee |
|---|---|---|---|
| UPI | ₹60,000 | 2% | ₹1,200 |
| Debit and credit cards | ₹20,000 | 2% | ₹400 |
| Netbanking and wallets | ₹10,000 | 2% | ₹200 |
| Corporate cards | ₹5,000 | 2.15% | ₹107.50 |
| International cards | ₹5,000 | 3% (upper limit) | ₹150 |
| Platform fee | ₹2,057.50 | ||
| GST at 18% | ₹370.35 | ||
| Total deducted | ₹2,427.85 |
You receive about ₹97,572, an effective cost of roughly 2.43%. Price your products with 2.5% set aside for payments and you will not be caught out.
When the money arrives
Razorpay's settlements documentation gives the standard domestic cycle as T+2 working days from capture, while the pricing page describes it as "typically T+1 or Instant". The docs add that the cycle depends on bank approval, your business vertical and risk factors, so treat the number in your own dashboard as the real one.
Instant Settlement is an on-demand add-on you request from support. Razorpay describes the cost as "a small fee", shows the exact fee plus tax before you confirm, and applies a daily withdrawal limit. It does not publish a standard rate, so check it before relying on it for cash flow.
Pre-submission checklist
| Check | Why it matters |
|---|---|
| Business type matches your PAN and documents | Cannot be changed after the account is created |
| Proprietors: two business documents ready, one of them GST or Udyam | New requirement since January 2026 |
| PAN and address proof belong to the same person | Razorpay requires them to match |
| Original physical PAN card at hand | e-PAN and printouts fail video KYC |
| Bank account number and IFSC checked; cancelled cheque available | Failed bank verification means a cheque video |
| Category licence (FSSAI, AYUSH, hallmark) if relevant | Listed as additional documents |
| Nothing on the prohibited list, including replicas and herbal "cures" | Unsupported category is the stated reason for rejection |
| Site live with About, Contact, Pricing, Terms, Privacy and Refund pages | Needed for the website check and live API keys |
| Sample invoice saved as PDF or image | Uploaded with website details |
How this works in Selzix
On an INR store, Selzix connects to your own Razorpay account, so you complete Razorpay's KYC under your name and payments settle from Razorpay to your bank on your Razorpay settlement cycle. Selzix adds no transaction fee of its own; Razorpay's fees and GST still apply.
While activation is pending, you can turn on direct UPI with your own UPI ID or QR, plus cash on delivery. The limit: direct UPI payments are not verified automatically, so you confirm each one against your bank app before shipping. See the features page for the full payment options.
Frequently asked questions
Can I get a Razorpay account without GST?
Yes. Razorpay's FAQ says GST and a current account are not mandatory for very small, new businesses. Choose "I don't have GST" and use a savings account. Proprietors still need two business documents from the accepted list.
How long does Razorpay activation take?
With an existing CKYC record, Razorpay says activation can take minutes. Without one, its FAQ puts the review at 3 to 4 business days after video KYC and DigiLocker are done, and working days exclude weekends and bank holidays. Razorpay also sells assisted onboarding for a fee, promising activation within 8 business hours.
I chose the wrong business type. What now?
If you have not submitted KYC yet, you can still update it. After the account is created and KYC is in, Razorpay says the business type cannot be changed, so you would need a new account. Razorpay's Multi-Account feature lets you open another under the same mobile number and email.
Does Razorpay charge for UPI payments?
There is zero MDR on UPI, but Razorpay applies its standard 2% platform fee plus GST, so on Razorpay a UPI payment costs the same as a domestic card payment.
Can I take payments before my website is approved?
Yes, through Payment Links and Invoices created in the Razorpay dashboard. Checkout on your own website needs live API keys, which Razorpay releases only after it has your live website details.
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