New payment technology powers India’s impressive eCommerce growthmCommerce to make up half of the online shopping market by 2021
October 18, 2017
18th October 2017 – New Delhi — India’s burgeoning eCommerce market is set to double over the next five years, driven by advances in alternative payments technologies such as eWallets, mobile bank transfers and credit cards. According to new data from leading payments company Worldpay, India is on track to be worth US$104bn by 2021, which will make it the seventh biggest eCommerce market in the world.
mCommerce is the fastest growing sector, projected to quadruple over the next four years, making up 45% of all online sales. Indian consumers’ enthusiasm for mobile shopping is supported by the popularity of new payment methods such as eWallets, which account for an ever-increasing share of the market. In 2017 eWallets represented 26% of all online payments, but this is set to grow to 37% by 2021.
Bank transfers are the second most popular payment method with 27% of the market today; this is set to increase to 34% by 2021 thanks to the advance of new payment technologies.
Worldpay’s report predicts a big drop in the popularity of cash on delivery, falling from 13.5% of the market today to just 3% in five years. The decline in cash and the rise of alternative payments are fuelled by India’s recent “cash crisis”, which followed the recent withdrawal of 500 and 1,000 rupee notes from circulation in an effort to reduce corruption.
The findings are published in Worldpay’s annual Global Payments Report, which analysed eCommerce spending patterns across 36 different markets on five continents. The report forecasts that the Asia-Pacific eCommerce market will grow by an average of 12% annually, and is set to be worth US$2,100bn by 20211. India is one of the fastest growing markets in the regions, set to double over the next five years.
The country’s demonetisation drive, coupled with a new generation of digital payment services is opening up new opportunities for a relatively high proportion of “unbanked” to make purchases online, where this was previously not possible.
Commenting on the research, Phil Pomford, General Manager Asia-Pacific at Worldpay said: “India is one of the fastest-growing eCommerce markets in the world, and demonetisation is proving to be a strong force pushing the use of digital payments. India’s cash economy has struggled in 2017, but this has been offset by significant growth in alternative payment methods and credit cards, and their share of the market will only grow as more Indian consumers gain access to the Internet via mobile and desktop devices.
“The growth of eCommerce in India, coupled with the country’s enormous potential, provides lucrative opportunities for retailers and merchants who can support India’s preferred payment methods,” concluded Pomford.
Worldpay has compiled the following recommendations for merchants looking to cash in on the continued strong growth of mCommerce and eCommerce in India and the wider Asia-Pacific region:
- One-click ordering: Consumers are more likely to shop more often with companies that save their payment details for one-click ordering. Merchants should provide one-click ordering to make online checkout as seamless as possible – especially via mobile apps.
- Offer choice: The decline in credit and debit cards means it will be more important than ever to provide popular alternative methods including e-Wallets like PayPal and Visa Checkout.
- Cross-border trade: Merchants should ensure that they have local acquiring capabilities wherever they have a legal entity; offer a wide range of currencies at checkout; and consider local language customer support in their customers’ time zone to deliver a great customer experience.
About the 2017 Global Payments Report
This report was compiled using a mixture of primary and secondary data sources. Primary refers to our own surveys and commissioned research; whereas secondary refers to authoritative third-party vendor data, and other publicly available data. The report also draws upon Worldpay’s decades of experience in providing global eCommerce solutions. The eCommerce projected growth figures contained in this report were sourced from GlobalData’s eCommerce Analytics database and relate to the eCommerce industry as a whole, not Worldpay’s business. GlobalData collected this data using consumer surveys, B2B surveys and desk research. Any indicative predictions based on the data we have used should be treated as such.
Worldpay is a leading payments company with global reach. We provide an extensive range of technology-led payment products and services to around 400,000 customers, enabling their businesses to grow and prosper. We manage the increasing complexity of the payments landscape for our customers, allowing them to accept the widest range of payment types around the world. Using our network and technology, we are able to process payments from geographies covering 99% of global GDP, across 146 countries and 126 currencies. We help our customers to accept more than 300 different payment types. For more information, visit http://www.worldpay.com/global
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