India is home to the highest consumer ecommerce growth rate in the world.1 This market has seen explosive adoption of digital money and smartphones over the last five years2 and the Covid-19 pandemic has further accelerated this trend.

The government and private firms are working hard to bring more of Indian’s population online through initiatives like Digital India. These efforts are critical for tapping into India’s young, internet-hungry population and growing middle class. Of India’s 1.4 billion people, 735 million are still lacking Internet access.3 India’s near-term economic growth will be driven by how many people it can bring online.

Country At A Glance

  • Population: 1.4 billion1
  • GDP per capita: $2,015.594
  • eCommerce market value: $36.5 billion1
  • Mobile commerce market value: $16.8 billion1
  • % of population using the internet: 50%5
  • % of population with mobile phones: 29%6
  • % of population with bank accounts: 79.9%1
  • % of population with credit cards: 3%7

India eCommerce Payment Trends:

India’s vast and diverse population provides a huge opportunity and creates unique economic and cultural challenges. When it comes to selling online in India, companies looking to tap into this rapidly shifting digital landscape need to understand several key factors.

1. Indians Have a Big Appetite for Cross-Border eCommerce

For international companies, India is an attractive opportunity. Indian’s have a large appetite for cross-border ecommerce, which gives international vendors a major foothold. Shopping will only increase as more Indians join the middle class and adopt smartphones. However, companies should keep a close eye on the federal government’s growing interest in giving preference to domestic firms via initiatives like its Make in India program.

2. App-Based Shopping and Payment Experiences Are Key

In India, in-app transactions represent over 82%1 of all completed mobile commerce purchases. Clearly, Indians prefer app-based shopping over mobile sites, and companies need to be mindful of designing stellar app-based shopping and payment experiences. India also has the largest cohort of the Mobile-first generation. India’s relatively young population may drive this preference for in-app shopping. In 2019, 27% of Indians were under 14.1

3. Digital Payments Are Gaining Popularity but Cash Can’t Be Ignored

After the Unified Payments Interface (UPI) 2.0 launch in 2018, UPI and has become the foundation of eWallet growth stories like Google Pay, WhatsApp Pay, Flipkart’s PhonePe, and even India’s longtime leader Paytm.8 The result is that digital wallets are experiencing explosive growth. However, cash on delivery remains incredibly popular — so savvy merchants will offer customers a variety of payment options.

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India eCommerce Data

  • eCommerce revenue (2017): US$39 billion3
  • Projected ecommerce revenue (2020): US$120 billion3
  • Average annual ecommerce revenue per user: $338.241
  • % of ecommerce purchases that are cross-border: 74%1
  • % of population shopping online: 28%9

Top eCommerce Merchant Segments10

  • Consumer electronics: 48%
  • Clothing and apparel: 29%
  • Home and furnishing: 9%
  • Baby, beauty, personal care: 8%

Top Payment Methods by Percent of Total Online Spending1

  • Card: 29%
  • Digital wallet: 25%
  • Bank transfer: 20%
  • Cash: 17%
  • Other: 9%

APAC: Consumer Online Buying and Payment Study Insights

In 2020, Rapyd conducted a research study to understand the financial habits and payment method choices, considerations and preferences of consumers in seven different APAC countries.  Here are key insights into popular payment methods in India.

  • While CODs are the third most used method, they are ranked near the bottom in term on consumer preferences
  • Consumer preferences indicate a strong demand for digital payment methods
  • eWallets are preferred to credit cards when consumers are given the option

Bar Graph: Most Frequently Used Payment Methods in India

Pie Chart: Most Popular Payments Methods in India

Looking for the Fastest Way to Offer All the Ways India Likes to Pay?

Rapyd helps international businesses grow in India and Indian businesses to scale internationally. Our all-in-one solution for India provides locally preferred methods to accept and make payments, including a seamless way to digitize cash transactions.

Start Accepting Local Payment in India





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