In 2023, India’s e-commerce sector witnesses a vibrant mix of payment methods. Card payments soar, marking a 28.6% growth. They reach a transaction value of $337.1 billion. Following a robust growth in 2022, cards now hold a 25.7% share in e-commerce payments. RuPay, a local scheme, gains traction, enhancing secure transactions. Conversely, Cash on Delivery (COD) dominates, accounting for nearly 60% of transactions. Digital wallets, however, are on the rise, ready to overshadow cash by 2023. They cater to the growing consumer preference for digital transactions. Bank transfers and instant payments carve a niche too, driven by apps like BHIM UPI. The Buy Now, Pay Later (BNPL) sector also escalates, reflecting a diverse, evolving payment landscape in India’s booming e-commerce market.

Payment by card in India

In 2023, card payments in India’s e-commerce sector are surging. They grow by 28.6%, reaching a value of $337.1 billion​1​. This spike follows a robust 26.2% growth in 2022 due to improved economic conditions. In e-commerce, cards rank as the second preferred payment method, holding a 25.7% share​2​. Specifically, credit and charge cards dominate with a 15.4% share in 2023. The value of debit card payments hits about seven trillion Indian rupees, while credit card payments soar, exceeding 14 trillion Indian rupees​3​.

Additionally, RuPay, a local card payment scheme, gains acceptance at ATMs, POS devices, and e-commerce sites, offering a secure payment network against anti-phishing​4​. This data highlights a strong preference for card payments among Indian online consumers, fueled by a thriving digital economy and solid cashless frameworks.

Local actor: RuPay

RuPay logo


Payment by cash

In 2023, cash retains a notable presence in India’s e-commerce sector, especially through Cash on Delivery (COD). COD dominates, accounting for nearly 60% of e-commerce transactions. It caters to buyers wary of online payments, offering post-delivery payment. However, a shift emerges. Digital wallets are set to overtake cash at point-of-sale by 2023, making up almost half of the e-commerce transaction value. Despite this, cash remains favored, representing 37% of e-commerce payments. This scenario underscores a mixed payment landscape where traditional and digital payment methods co-exist, catering to diverse consumer preferences​1​​2​​3​​4​.


Payment by bank transfer

In 2023, bank transfers and Instant Payments carve a niche in India’s e-commerce sector. A key player is the Bharat Interface for Money app, leveraging the Unified Payments Interface (BHIM UPI). It holds a 60% share among payment systems in India during the financial year 2023​1​. Instant payments are on the rise, initially driven by peer-to-peer transfers. Now, they’re expanding into commercial transactions, providing stiff competition to traditional card schemes​2​.

The spike in online transactions is fueled by increased internet access and awareness. Consequently, bank transfer ranks among the top methods for online e-commerce payments in India, alongside cards and digital wallets​3​. Additionally, platforms like Cashfree Payments support a variety of payment modes. They facilitate net banking, a form of bank transfer, and digital payment methods like UPI via BHIM UPI, Google Pay, and PhonePe​4​. This paints a picture of a diverse payment landscape in India’s e-commerce sector, blending traditional and modern payment systems.

Local actors such as: UPI, IMPS, Jupiter, Fi, Fyp, InstantPay, mool, Freo, Fampay

UPI logo    Jupite logo  FI Logo  Fyp Logo  Instantpay Logo  Mool logo  Freo Logo  Fampay Logo


Payment by installment and BNPL

The Buy Now, Pay Later (BNPL) sector in India is witnessing a significant upswing. In 2023, it’s anticipated that BNPL payments will escalate to approximately US$14.3 billion, representing a robust annual growth rate of 22.9%​1​​2​. This growth trajectory is largely propelled by the burgeoning e-commerce sphere and the widespread consumer appetite for flexible payment alternatives. Various innovative BNPL models have sprouted in response to this burgeoning demand, each with its unique proposition to both merchants and consumers. For instance, Instant Financing at the point of sale, merchant-specific BNPL programs, Credit Card BNPL features, and Pay Later Apps are some of the prevalent models currently in vogue​2​.

Furthermore, the Indian market has seen a flurry of activity from leading fintech and e-commerce players who are forging a three-way bridge between merchants, consumers, and financial institutions to smoothen the BNPL experience​2​. The likes of LazyPay, ZestMoney, and KreditBee are among the myriad BNPL providers that experienced a surge in demand, especially during the festive season of 2022​3​.

Local actors such as: Axio (formerly Capital Float), Simpl, Lazypay, kissht, Pine Labs, ePayLater, KreditBee, Zest, Uni, Flexmoney, Slice, Flipkart, Rupifi, Mobikwik

Axio logo    Lazypay logo  Kissht logo  Pinelabs logo  ePaylater logo  KreditBee logo  Zest logo  UNI logo  Flexmoney Logo  Slice logo  Flipkart Logo  Rupifi logo  Mobikwik Logo


Payment by digital wallet and X-Pay

E-commerce growth in India paves the way for digital wallet payments. By 2023, digital wallets are forecasted to eclipse cash, becoming the leading point of sale payment method. This transition should account for nearly half of the e-commerce transactions, according to fintech firm FIS​1​.

Moreover, the e-commerce market in India is surging, projected to swell 96% to $120 billion between 2021 and 2023. This growth intertwines with the rising popularity of digital wallets, poised to significantly impact this expansion​2​.

This shift towards digital wallets isn’t surprising. They offer convenience, speed, and ease of transactions, attracting more consumers. Their digital nature aligns with online shopping, making them a natural choice for e-commerce transactions.

Furthermore, as consumers enjoy the simplicity and instantaneity of digital transactions, the allure of digital wallets grows. This rising interest isn’t merely a trend. It reflects a broader move towards digitalization in the financial realm, driven by technological advancements and changing consumer preferences.

In summary, 2023 is set to witness digital wallets becoming a cornerstone of the e-commerce payment landscape in India. This evolution highlights the growing e-commerce market and the shifting consumer payment preferences in the modern digital era.

Local actors such as: Jio Payments, PayZapp, ItzCash, YesBank, dhani, Mobikwik, PayTm, PhonePe, Citrus, ItzCash, Oxigen

JioMoney logo  PayZapp logo  YesBank logo  Dhani Logo  Mobikwik Logo  Paytm logo  PhonePe logo  CityUnionBank logo  ITZ logo



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