The Zoho Indian Merchant Payment Survey 2026 arrives with a headline built to travel. 78% of Indian businesses would switch their primary payment gateway if another provider offered the AI capabilities they expect. The survey, based on responses from 700+ businesses across India, positions AI as the new battleground for payment-provider selection. Businesses want fraud detection, automated reconciliation, smart routing, and deeper integration with accounting and ERP systems.
The announcement comes from Zoho Payments, a product of Zoho Payment Technologies, a wholly-owned subsidiary of Zoho Corporation. Sivaramakrishnan Iswaran, CEO of Zoho Payment Technologies, framed the findings as proof that Zoho Payments delivers what businesses want. The survey, the product, and the messaging arrive together. That is where the analysis begins.
What the Zoho Indian Merchant Payment Survey Actually Says
The headline statistic: 78% of businesses would consider switching their primary payment gateway for AI capabilities they expect. Nearly 60% already use AI in payment operations, and another 20% are evaluating them. Only one in five remain unaware of such capabilities.
Fraud detection ranked as the most sought-after AI capability, followed by smart payment routing and automated reconciliation. Other expected features include risk assessment, chargeback and dispute settlement, and customer insights. 65% of businesses cited integration with accounting, billing, or ERP systems as the main reason for staying with their current gateway. This was particularly important among medium enterprises with revenues between Rs 10 crore and Rs 50 crore, and large enterprises above Rs 250 crore.
The top three operational challenges were refund delays, payment failures (56%), and slow settlement. Reconciliation was a challenge for 46%, with 61% spending one to three hours daily on it and nearly 20% spending three to six hours. Only 14% complete reconciliation in under an hour.
On fraud, UPI social engineering scams led at 58%, followed by false chargebacks (37.7%), COD return fraud (30%), and identity fraud during onboarding (16.7%). Industry patterns varied. Retail businesses faced false chargebacks at 43%, while manufacturers reported COD return fraud at 52%.
Same-day settlement was the leading reason to switch providers, followed by lower fees and MDR, and better reconciliation. 83% of businesses said they would pay for guaranteed same-day settlement, with the majority being micro and growth-stage enterprises.
The Survey Was Self-Commissioned, Self-Conducted, and Self-Serving
Zoho Payments conducted the survey using Zoho Survey, Zoho’s own survey software. No independent research firm participated. The press release does not disclose the survey period, sampling methodology, response rate, margin of error, or respondent breakdown by company size. No way exists to verify whether the sample represents India’s merchant base or skews toward Zoho ecosystem businesses.
This matters because the findings map precisely onto Zoho Payments’ product strategy. The survey identifies integration with accounting and ERP systems as the top reason businesses stay with their current gateway. That is exactly the differentiator Zoho Payments claims over standalone payment providers. The survey also highlights AI-driven fraud detection, bank reconciliation, revenue forecasting, and anomaly detection as desired capabilities. Those are the exact features Zoho Payments lists on its product page.
The survey emphasizes that businesses want payments deeply integrated with finance workflows. That is the core value proposition of Zoho Payments being natively embedded in Zoho Books, Zoho Billing, and Zoho ERP. A company conducting its own survey, publishing findings that validate its product roadmap, and using them to promote that product warrants scrutiny. The findings demand caution regardless of whether they contain real signal.
Zoho Payments: A Market Entrant With No Disclosed Metrics
Zoho Payments launched on August 29, 2024, at Global Fintech Fest in Mumbai. The company received its RBI payment aggregator license in February 2024. The product is approximately 25 months old. Despite the survey’s emphasis on business expectations, Zoho discloses no performance metrics for Zoho Payments. No merchant count, no transaction volume, no payment success rates, no fraud detection rates, no reconciliation time savings, no settlement speed data.
Zoho Payments does not appear in any major market research firm’s list of top Indian payment gateway providers. Mordor Intelligence’s 2026 report lists 20 major players. Razorpay, PayU, Paytm, CCAvenue, BillDesk, Cashfree, Pine Labs, Juspay, and Stripe all appear. Zoho Payments does not. Ken Research, Custom Market Insights, and MarkNtel Advisors similarly omit Zoho Payments from their competitive landscapes.
The India payment gateway market was valued at $2.07 billion in 2025 and is projected to reach $4.01 billion by 2031, growing at 11.66% CAGR. Zoho Payments’ share of this market is not measurable from available public data.
This does not mean Zoho Payments lacks a viable strategy. Native integration with a finance suite that 150 million users already access is a genuine competitive advantage for businesses in the Zoho ecosystem. The question is whether Zoho can compete for non-Zoho customers. Its rivals have far larger transaction datasets and more mature AI deployments.
Razorpay’s Vulcan Sets the AI Bar Zoho Has Not Cleared
Three weeks before the Zoho Indian Merchant Payment Survey announcement, Razorpay launched Vulcan on August 18, 2026. Vulcan is India’s first transformer-based AI foundation model built for payments. Developed with NVIDIA and AWS, it was trained on approximately 3 trillion data points across 4 billion payments. It draws on roughly 3,000 signals per transaction.
Early results from live deployment across 1.5 million shoppers and 51,000 businesses are quantified. Payment success rates improved 8-10%. Eight times more international card fraud was detected and stopped. Five times more fraudulent or disputed transactions were identified without increasing alert volumes. Customers including Blinkit, Bachatt, and redBus piloted the model in live payment environments.
Razorpay reported FY25 operating revenue of Rs 3,783 crore, a 65% increase year-on-year. It holds an estimated 21% share of the Indian payment gateway market. Razorpay also operates Thirdwatch, an RTO risk intelligence system studying more than 300 parameters to flag risky COD orders. It has reported a 35% reduction in OTP-related authentication errors through biometric and passkey-based card authentication.
Zoho Payments’ AI capabilities — fraud detection, bank reconciliation, revenue forecasting, anomaly detection, and the recently launched Zoho MCP server — are described in feature terms. No training data volume, no model architecture, no performance metrics, and no customer pilot results are disclosed. The Zoho MCP server launched May 25, 2026. It enables AI clients like Claude and ChatGPT to perform payment actions through natural-language prompts. It is an integration layer, not a fraud-detection or routing engine.
The distinction matters. The survey asks businesses what AI capabilities they expect, and Zoho Payments positions itself as meeting those expectations. But the gap between Razorpay’s quantified deployment and Zoho’s described features is wide.
The Competitors Zoho’s Survey Does Not Name
The Indian payment gateway market is concentrated and competitive. PayU serves more than 500,000 businesses across 150+ payment modes, with SaaS and value-added services contributing 34% of its payments revenue. Cashfree processes approximately $80 billion annually across more than one million businesses and undercuts Razorpay’s published rate at 1.95%.
Juspay reported FY25 revenue of Rs 514 crore, up 61% year-on-year. Its annualized total payment volume hit $1 trillion, with 300 million daily transactions, and it swung to a Rs 62 crore net profit. Pine Labs went public in November 2025 with 988,000 merchants across 20 markets. PhonePe is IPO-bound with rising merchant payment volumes.
None of these competitors appear in Zoho’s survey. The findings reference “businesses” and “payment providers” in the abstract. They do not acknowledge that the companies already delivering AI at scale are the same companies Zoho Payments must compete against.
The finding that 65% of businesses stay with their current gateway for integration reasons cuts both ways. It suggests businesses are reluctant to switch, which may benefit incumbents more than entrants. Zoho Payments must convince businesses that its AI is superior. It must also show that migrating to Zoho’s ecosystem is worth the disruption.
The Fraud Picture: Real Problem, Partial Solution
The survey’s fraud findings align with government data. India recorded over 1.63 million UPI fraud cases in FY26 as of March 15. These involved Rs 12.26 billion, according to Ministry of Finance data presented to Parliament. In FY25, India reported 1.26 million UPI fraud cases involving Rs 9.81 billion. The RBI issued a discussion paper in April 2026 highlighting the rise of Authorized Push Payment frauds driven by social engineering and instant fund transfers.
But the dominant fraud pattern — UPI social engineering scams at 58% — is a consumer-side problem. Payment gateway AI cannot fundamentally solve it. Social engineering fraud occurs when users authorize payments through fake customer care calls, phishing links, screen-sharing apps, or malicious QR codes. The gateway processes a legitimate authorization from a deceived user.
Gateway-level AI fraud detection addresses card fraud, false chargebacks, COD return fraud, and network-level patterns. It does not stop UPI social engineering where the user voluntarily approves the debit. Razorpay’s Vulcan addresses this partially through network-level fraud detection and RTO risk intelligence. But even Razorpay acknowledges that UPI fraud is primarily a social engineering problem requiring user awareness and device binding.
The survey conflates fraud types that gateway AI can address with fraud types it cannot. This framing serves Zoho Payments’ product narrative but oversimplifies the fraud challenge.
Settlement Speed: A Need Zoho Does Not Currently Meet
The survey finds that 83% of businesses would pay for guaranteed same-day settlement. Same-day settlement is the leading reason businesses would switch providers. This is one of the most actionable findings — and it highlights a gap in Zoho Payments’ own offering.
Zoho Payments’ default settlement cycle is T+2, the same as Razorpay and Cashfree. Cashfree offers instant settlement within 15 minutes for an additional charge. The survey identifies faster settlement as a primary switching driver, but Zoho Payments does not currently offer same-day settlement as a standard feature.
The survey’s most commercially relevant finding points away from Zoho Payments, not toward it. Unless Zoho plans to introduce same-day settlement. In that case, the survey lays groundwork for a future product announcement.
Zoho’s Broader Bet: Payments as a Finance Ecosystem Play
Zoho Corporation reported FY25 revenue of Rs 12,313 crore, up 17.8% year-on-year, with net profit of Rs 3,191 crore. The company became the first bootstrapped Indian technology company to cross the Rs 12,000 crore revenue mark. It has never raised external funding. The company employs over 19,000 people, serves 150 million users across 60+ applications, and spends approximately 60% of revenue on R&D. Founder Sridhar Vembu transitioned to Chief Scientist in January 2025, with co-founder Shailesh Kumar Davey taking over as Group CEO.
Zoho’s entry into payments is not a standalone payments play. It is a finance-ecosystem play. Zoho Payments exists to deepen the value of Zoho Books, Zoho Billing, Zoho ERP, and the broader Zoho finance suite. For businesses already in the Zoho ecosystem, native payment integration reduces reconciliation friction. It eliminates third-party gateway accounts and creates a closed-loop finance workflow.
This is a real value proposition — but it serves Zoho’s existing customer base, not necessarily the broader market. The company has also expanded into consumer fintech with Zoho Pay and invested Rs 70 crore in ONDC. These moves signal ambition. They do not change the fact that Zoho Payments’ market position remains unmeasured.
What the Reader Needs to Know That the Press Release Does Not Say
The Zoho Indian Merchant Payment Survey contains genuine signal. Indian businesses do want AI in payments, integration with finance systems, faster settlement, and better fraud protection. Market data, government fraud statistics, and the competitive moves of Razorpay, Cashfree, PayU, and Juspay validate these as real pain points.
The press release omits that Zoho conducted the survey using its own survey tool, with no independent verification. The company does not disclose Zoho Payments’ merchant count, transaction volume, market share, or AI performance metrics. No competitor is named.
The survey does not acknowledge that Razorpay, the market leader, launched a quantified AI foundation model three weeks earlier. Zoho Payments is absent from every major market research firm’s competitive landscape. And the survey’s most commercially relevant finding — demand for same-day settlement — points to a capability Zoho Payments does not currently offer.
The survey is a marketing instrument. That does not mean its findings are wrong. Read them as a vendor’s reading of a market it is trying to enter, not as an independent assessment.
Sources and Verification
Editor’s Note: This article draws on Zoho’s press release dated September 9, 2026. It also references the Zoho Indian Merchant Payment Survey 2026 report published at zoho.com. The press release does not disclose key survey methodology details. These include the survey period, sampling methodology, response rate, margin of error, and respondent breakdown by company size. These are Company-Claimed.
Zoho’s FY25 financial figures come from Registrar of Companies filings. The Economic Times and Entrackr reported these (Rs 12,313 crore revenue, Rs 3,191 crore net profit) in April 2026. These are Independently Verified.
Razorpay Vulcan launch details and performance metrics are from Razorpay’s press release dated August 18, 2026, and are Company-Claimed. Razorpay’s FY25 revenue (Rs 3,783 crore) and market share estimate (21%) come from Mint and industry posts. These are Independently Verified, though the market share figure is an estimate.
UPI fraud statistics (1.63 million cases, Rs 12.26 billion in FY26) come from Ministry of Finance data presented to Parliament. Informist Media reported this in March 2026 — Independently Verified. The India payment gateway market size ($2.07 billion in 2025, $4.01 billion by 2031) is from Mordor Intelligence, August 2026 — Independently Verified.
Zoho Payments’ absence from major market research competitive landscapes is Uncertain, as the company may appear in reports not reviewed for this article. The characterization of Zoho MCP as an integration layer rather than a fraud-detection engine is the author’s assessment based on Zoho’s product documentation. No independent third-party research firm was involved in Zoho’s survey. Readers should treat the findings as directional vendor research, not as independent market data.
Contact: techrecasteditor@gmail.com