eSewa vs Khalti: which payment gateway is better for Nepal businesses?

Nepal's digital payment market has exploded. There are now 28.3 million digital wallet users, up from 6.3 million in 2020. QR payment transactions went from 200,000 per month to 59.3 million. Electronic payment values nearly tripled in five years, reaching NPR 98.43 trillion in FY 2024/25.

At the center of this shift are two platforms that every Nepal business owner encounters: eSewa and Khalti. If you are building an online store, launching a service, or accepting payments digitally, you need to choose between them. Or, more accurately, you need to decide which to set up first.

This guide compares them on everything that matters to a business: user base, fees, developer experience, settlement, coverage, and which to choose for your specific situation.

Company overview

The IME Pay merger: what changed

In July 2025, Khalti and IME Pay merged to form IME Khalti Ltd. IME Pay contributed NPR 300 million in paid-up capital to Khalti's NPR 50 million. The merger combined their user bases to 12.7 million, surpassing eSewa's 10.8 million individual users at the time. The merged entity operates as "IME by Khalti" and integrates IME Group's infrastructure (InfoDevelopers, Midas Technology, SastoDeal). This changed the competitive landscape significantly: Khalti went from being the smaller challenger to having the larger combined user base.

Head-to-head comparison

User base and market share

Market share data from Nepal Database (citing NRB Payment Systems Department data, late 2025-2026):

• eSewa: 38% of wallet transactions
• Khalti: 29% of wallet transactions
• IME Pay: 18% of wallet transactions (now merged with Khalti)
• Others (Prabhu Pay, Cellfin, etc.): under 5% combined
• Bank channels: capture 41% of high-value transfers (over NPR 50,000)

eSewa has the single largest brand presence and the widest merchant acceptance network (560,000+ merchants, 280,000+ authorized representatives). Khalti's merger with IME Pay creates a combined entity that, on paper, surpasses eSewa in total user count (12.7M vs 10.8M), though the two apps have not fully unified yet.

For a merchant deciding which to integrate: eSewa's brand recognition means more of your customers will have it installed. Khalti's younger user base may be more active in e-commerce. Both matter.

Fees and costs

The fee difference is minimal in practice. Khalti is NPR 5,000 cheaper on setup and has a slightly lower fee cap (2.2% vs 2.5%). Both negotiate rates for volume merchants. The typical MDR (Merchant Discount Rate) across Nepal payment providers is 1.2-1.5%.

Total integration cost including development work and testing typically runs NPR 50,000-150,000 for both gateways combined. This is a one-time investment that pays for itself if it prevents even a handful of abandoned checkouts per month.

Developer experience

This is where Khalti has a clear advantage. If you are a developer or working with one, the integration experience matters.

Khalti API

• Cleaner, more consistent API design
• Better sandbox environment for testing
• Actively maintained documentation
• Official WooCommerce plugin on GitHub (open-source)
• Self-service integration (less back-and-forth with support)
• Typical integration time: 2 hours to 1 day

eSewa API

• Functional but documentation can be outdated
• Lacks merchant webhooks in some flows
• Manual verification required for certain transaction types
• Community-maintained WooCommerce plugins (not official)
• May require support contact for setup issues
• Typical integration time: 1-3 days

For WordPress/WooCommerce stores (the most common setup in Nepal), Khalti's official GitHub plugin is a significant advantage. eSewa integration works but often requires more custom development.

Merchant features

Both platforms now support NepalPay QR, which has reached 85% of registered merchants by August 2026. This means a customer with either wallet can scan the same QR code at most merchants. Interoperable QR transactions now account for ~33% of merchant scans, up from 15% the previous year.

Security and limits

Both eSewa and Khalti are licensed by Nepal Rastra Bank and comply with NRB cybersecurity standards. Both use multi-factor authentication (MPIN + OTP).

eSewa offers additional security features: biometric verification (fingerprint), Face ID, device-level authentication, and Intent-Based Payment. Khalti has standard MPIN + OTP security. For high-value transactions, both wallets are limited by NRB regulations. Bank channels handle 41% of transfers above NPR 50,000, as wallet limits make them impractical for large payments.

Other Nepal payment gateways

eSewa and Khalti are not the only options. Here is the full picture:

ConnectIPS is worth integrating alongside eSewa and Khalti: it has no setup fee and handles bank-to-bank transfers that wallets cannot do efficiently for amounts above NPR 50,000. FonePay's QR network is massive (1.4-1.7 million merchants, 60+ banking partners) and is the backbone of interoperable QR payments in Nepal.

Nepal's digital payment landscape

The context behind these numbers explains why payment gateway choice matters now more than ever.

• 28.3 million digital wallet users as of mid-May 2026, up from 6.3 million in 2020 (4.5x growth).
• 59.3 million monthly QR transactions (mid-2026), up from fewer than 200,000 in 2020.
• Electronic payments nearly tripled in 5 years: FY 2020/21 NPR 34.42 trillion to FY 2024/25 NPR 98.43 trillion.
• Mobile banking grew 10x: NPR 460 billion to NPR 5.02 trillion.
• QR payments grew 50x: NPR 20.28 billion to NPR 958.38 billion.
• Digital wallet transactions: NPR 114 billion to NPR 506 billion.

Regulatory changes in 2026

• Simplified KYC threshold: raised from NPR 5,000 to NPR 10,000 monthly turnover (easier onboarding for small merchants).
• National ID update deadline: mid-October 2026 for wallet KYC.
• Real-time settlement: NRB mandated for interoperable QR (previously T+1).
• PSO/PSP public company transition: payment companies must transition to public companies.
• Only 4 PSPs currently profitable: eSewa, Khalti, IME Pay, and Prabhu Pay. NRB estimates the market needs "at most, five PSPs."

The profitability data is telling: NRB sees consolidation coming. The Khalti-IME Pay merger is the first wave. Smaller payment providers may merge or exit, making eSewa and the Khalti-IME entity the two dominant platforms going forward.

Which one should you choose?

The real answer: integrate both. The NPR 45,000 combined API cost prevents losing sales from customers who prefer one over the other. But if you must start with one:

Choose eSewa first if:

• Your customers are outside Kathmandu Valley (eSewa has stronger rural/tier 2-3 coverage)
• Your customer base skews older (30+)
• You need the largest single merchant acceptance network
• You serve tourists (Alipay+ integration for Asian/European wallet users)

Choose Khalti first if:

• You are a developer or startup (better API, faster integration)
• You use WooCommerce (official plugin on GitHub)
• Your customers are younger, urban, tech-savvy (Kathmandu Valley focus)
• You want lower upfront cost (NPR 20,000 vs NPR 25,000)
• You need Stripe connectivity for international payments

Always add ConnectIPS

ConnectIPS has no setup fee and handles bank-to-bank transfers. It is essential for businesses accepting payments above NPR 50,000 where wallet limits become a constraint. With 1.56 million users and growing, it covers a different use case than wallets.

Mistakes to avoid

1. Integrating only one gateway. Customers have preferences. If your checkout only offers eSewa and a Khalti user arrives, they may abandon the purchase rather than switch wallets. The NPR 45,000 for both is an investment, not a cost.
2. Forgetting COD. Despite 28.3 million digital wallet users, 70%+ of Nepal's online buyers still prefer cash on delivery. Not offering COD means losing the majority of potential orders. Digital payments are growing but are not yet dominant for e-commerce.
3. Not testing the payment flow. Test every payment method with real transactions before launching. Incomplete or broken checkout flows lose customers permanently because they rarely return after a failed payment experience.
4. Ignoring mobile checkout. 90%+ of Nepal's e-commerce traffic is mobile. Your payment flow must work seamlessly on phone screens. Test on actual Android devices (the dominant platform in Nepal), not just desktop browsers.
5. Not tracking transaction fees. Transaction fees of 1.5-2.5% add up. Track your effective fee rate monthly. Negotiate with both platforms as your volume grows. Large merchants can get rates as low as 0.5%.
6. Skipping KYC verification. Unverified wallets have lower transaction limits. Encourage customers to complete KYC by explaining the benefits (higher limits, better security). The NRB National ID deadline in October 2026 will affect unverified accounts.
7. Not planning for high-value transactions. Both eSewa and Khalti have NPR 50,000 daily limits. If you sell products or services above this amount, you need ConnectIPS or direct bank transfer as additional options.

Frequently asked questions

Which has more users, eSewa or Khalti?

eSewa has 10.8 million individual users and 38% of wallet transaction market share. Khalti merged with IME Pay in July 2025, creating a combined base of 12.7 million users with 29% market share (plus IME Pay's 18%). By individual brand, eSewa is larger. By combined entity, Khalti-IME edges ahead.

How much does it cost to integrate eSewa or Khalti?

eSewa charges NPR 25,000 for API setup. Khalti charges NPR 20,000. Transaction fees are 1.5-2.5% for eSewa and 1.5-2.2% for Khalti. Both settle T+1. Total integration cost including development and testing typically runs NPR 50,000-150,000 for both gateways combined.

Which payment gateway is better for developers?

Khalti has better developer tools: cleaner API, better sandbox, maintained documentation, and an official open-source WooCommerce plugin on GitHub. eSewa's documentation can be outdated and lacks webhooks in some flows. Most developers report faster integration with Khalti.

Should I integrate both eSewa and Khalti?

Yes. Together they cover the majority of digital wallet users in Nepal. Many customers have a strong preference and will abandon checkout if their preferred gateway is not available. The NPR 45,000 combined API cost prevents losing sales. Also add ConnectIPS (free setup) for bank transfer payments above NPR 50,000.