Total share of alternative payment methods in India for purchases made online grew to 58.1% in 2023 from 20.4% in 2018, a report by GlobalData said
The report attributed the uptick to the widespread usage of mobile wallets, largely driven by UPI
In the APAC region, only China was ahead of India in terms of share of alternative payment methods (systems other than cash and bank transfers) in ecommerce transactions
Amid the rapid increase in digital transactions on the Unified Payments Interface (UPI), India saw the highest increase in the share of alternative payment methods (systems other than cash and bank transfers) in ecommerce transactions in Asia-Pacific (APAC) between 2018 and 2023.
A report by London-based data analytics and consulting company GlobalData said that the total share of alternative payment methods in the country for purchases made online grew to 58.1% in 2023 from 20.4% in 2018.
“This significant uptake of alternative payment solutions can be attributed to the widespread usage of mobile wallets, largely driven by UPI, which facilitates mobile payments in real-time simply by scanning QR codes,” the report said.
In the APAC region, only China was ahead of India in terms of share of alternative payment methods in ecommerce transactions at 65%.
It is pertinent to note that Indonesia, Hong Kong, Singapore, and Malaysia also saw rapid rise in alternate payment methods in ecommerce transactions, while Australia, South Korea, and Japan had less than 40% share each.
The discoveries were made by GlobalData in its ‘2023 Financial Services Consumer Survey’. The survey was carried out in the second quarter of the calendar year and saw responses from about 50,000 people above the age of 18 in 40 countries.
Powering the rise of the alternative payment methods in India is the increasing adoption of UPI. Launched in 2016, the real-time digital payments system has been constantly seeing an increase in the number of transactions.
For reference, the number of UPI transactions stood at 14.04 Bn in May 2024 as against 1.34 Bn in July 2020, which was a record at the time.
Phonepe, Google Pay, and Paytm continue to dominate India’s burgeoning UPI space. In May this year, these platforms accounted for about 94% of the total UPI transactions.
Meanwhile, ecommerce marketplaces Flipkart and Amazon are also seeing a gradual increase in the number of UPI transactions processed by them. While Amazon Pay accounted for 6.8 Cr UPI transactions in May, Flipkart’s recently-launched UPI service processed 44 Lakh transactions in the month.
