In what account should payment transaction fees need to be recorded? This is an expense right? Because we are not gaining profit out of it. Help, please.

I'd say that it's a form of income - a sort of surcharge much like shipping & handling that's added to the invoice. You can track it using the income account you use for most sales. Or, if you want it called out on your P&L, then use a new account created just for the fees.