Indians Embracing Digital Payments, Security A Deciding Factor: Survey

SUMMARY

93% of Indian consumers are likely to have used at least one mode of digital payment in the past year: Mastercard survey

Indian consumers are among those who are most open to digital payments methods in the Asia-Pacific region, it said

Digital wallets are the most popular digital payment method among Indian consumers

Digital payments are rising rapidly in the country and more and more Indians are adopting the cashless payment method. According to a survey commissioned by Mastercard, 93% of Indians are likely to have used at least one mode of digital payment in the past year.

Indian consumers are among those who are most open to digital payments methods in the Asia-Pacific region, Mint reported citing the survey. Compared to Indians, only Chinese consumers are more open to digital payments (98%).

The survey was carried out during March and April and 7,004 adults, evenly distributed across seven markets, participated in it.

Unsurprisingly, digital wallets are the most popular digital payment method among Indian consumers. 58% of Indian consumers used at least one of the digital wallets last year, while the affluent and millennial respondents showed higher usage of digital wallets, the report said citing the survey findings.

QR codes and digital money transfer apps are also popular among other digital payment methods, accounting for over 50% share. On the other hand, cash remains the third most popular method with a 51% share, it said.

However, other payment methods such as in-person credit, debit or pre-paid or contactless cards enjoy less than one-third share.

Besides, digital purchase activities are also increasing among Indian consumers, according to the survey. Around 56% of the respondents said they purchased from online marketplaces using a digital payment tool.

Other than marketplaces, they also bought items via a mobile app or using a merchant-specific payment tool like loyalty points or store credits. In the six months before the survey, at least one digital purchase was done by 91% of the respondents.

However, while reward points and freebies impact purchase decisions, security is the most important factor for consumers. Compared to 42% of the respondents who prioritise security over other factors when deciding which payment method to use, 32% choose best rewards and 25% see discounts and promotions as deciding factors, the survey found.

Additionally, millennials are more likely to look for rewards (37%). In terms of ease of use, only 39% of consumers put focus on that, the tendency being higher among generation-X (44-57 years age group).

According to an Inc42 report, India’s fintech market opportunity is expected to reach $1.3 Tn by 2025. Within this sector, lendingtech and insurtech are projected to have the largest share at a combined 73%. Meanwhile, the Unified Payments Interface saw 657 cr transactions worth INR 10.32 Lakh Cr in August.