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Retail digital payments to double to $7 trillion by FY30: Report

Over the past five years, retail digital payments have grown dramatically—from $300 billion in FY18 to $3.6 trillion in FY24. By FY30, they are likely to double to $7 trillion, according to a study by Amazon Pay India and Kearney India.

A staggering 90% of the consumers in the study stated they prefer digital payments for online purchases. This behaviour extends to offline purchases, with about 50% of consumers indicating a preference for digital payments in offline settings.

Millennials (aged 25–43) and Gen X (aged 44–59) lead the way for the adoption of all types of digital payments. Boomers (aged 60 and above) use their cards and wallets more than the younger cohorts.

Consumers in small towns highlighted that 65% of their payment transactions are digital, while the consumers in the top six metros (Mumbai and its suburbs, Delhi and NCR, Bangalore, Kolkata, Chennai and Hyderabad) and large and mid-size cities cited this ratio to be around 75%.

Co-branded credit cards are gaining momentum. Emerging methods such as buy now, pay later (BNPL), wearable payments, and voice assistant-based payments are also starting to make inroads, states the study report.

Five focus areas will fuel the next wave of growth:

  • Empower communities with financial education by launching targeted programs to boost awareness of digital payments and new methods such as UPI Lite and UPI Lite X to encourage adoption.
  • Create user-friendly consumer journeys by streamlining documentation and know-your-customer (KYC) processes, optimizing user interfaces, and establishing responsive customer complaint resolution mechanisms.
  • Enhance digital infrastructure by addressing system and network issues and exploring innovations such as UPI Lite X for areas with limited Internet.
  • Minimize the risk of fraud and enhance advanced security measures with fraud detection algorithms.
  • Expand access to credit-based payment methods by using alternate data for underwriting risk, develop innovative credit products, and promote credit education for financial health.

The report advocates that these five areas can foster a more inclusive, secure, and user-friendly environment, thereby enhancing the adoption of digital payments among consumers and merchants in India.

PR Newswire

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