Urban Indians are opting for digital payments for their purchases, both online and offline. A detailed study by Kearney India and Amazon Pay India called “How Urban India Pays,” found that 90% of urban Indians with internet access prefer digital payments for online shopping. Moreover, 50% of these people also like using digital payments for in-person purchases.
The study, which included over 6,000 consumers from different age groups and income levels, and more than 1,000 merchants in 120 cities emphasizes a big change in how people are paying. Convenience, safety, and easy tracking of transactions are the main reasons for this shift.
Prabhakar Bansal from Kearney exclaimed, “How Urban India Pays report is a clarion call, underscoring the urgent need for stakeholders to innovate and collaborate to build an inclusive, secure, and future-proof digital payments ecosystem. With digital transactions penetrating even street vendors and smaller towns, we are at an inflection point.”
The Impact of Digital Payments on Urban Safety
Mumbai provides a clear example of this change. In 2023, the police registered only 14 cases of pickpocketing, partially because fewer people are carrying cash. Most transactions are digital, and stolen bank cards can be quickly blocked.
These are becoming common not just in big cities but also in smaller towns. In these areas, 65% of transactions are digital, compared to 75% in larger cities. Cities like Lucknow, Patna, Bhopal, Jaipur, Bhubaneswar, Indore, Ahmedabad, and Pune have high levels of digital payment use, like major cities despite having smaller retail markets.
Inclusivity in Digital Payments Across Demographics
The study also found that people of all ages and genders are using D.P. Millennials and Gen X are leading the way, but even older people are using digital wallets and cards. Both men and women are using digital payments equally, with 72% of their transactions being cashless.
The growth of retail D.G in India is impressive, rising from $300 billion in 2018 to $3.6 trillion in 2024. This number is expected to reach $7 trillion by 2030, driven by more spending, wider internet access, and the increasing digital payment network.
UPI (Unified Payments Interface) is the most popular method, with 53% of people using it for online shopping. Digital wallets and cards are used by 30%. For offline shopping, while cash is still common, 25% of people use UPI, and 20% use digital wallets and cards. Co-branded credit cards like the Amazon Pay ICICI card are also becoming popular, with 46% of people owning one due to attractive rewards.
India is moving towards a digital future. The Reserve Bank of India’s (RBI) Payments Vision 2025 aims to make digital payments accessible and secure for everyone. This vision includes integrity, inclusion, innovation, and firm institutions to support digital payments everywhere.
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