The rampant increase in smartphone users and easy accessibility to the Internet are some major boosters for this expansion. Keeping in line with the Digital India movement, more and more companies are building a presence online to reach the masses
By Satyajit Kanekar, co-founder and chief executive officer, Mobileware Technologies
With the festive season settling in full peak, retail in India is witnessing a boom in the
e-commerce business. As per India Brand Equity Foundation, India’s e-commerce market is expected to reach US$ 111 billion by 2024 and US$ 200 billion by 2026. The rampant increase in smartphone users and easy accessibility to the internet are some major boosters for this expansion. Keeping in line with the Digital India movement, more and more companies are building a presence online to
reach the masses.
The country is now going beyond traditional payment methods with the easy adoption of ePOS, UPI, and others. The RBI states that total digital payments have increased by 216% and 10%, in terms of volume and value, respectively, for March 2022 compared to March 2019.
Online Payments and Apps
Nowadays, everyone prefers online payments because they are easy and seamless. This shift in consumer behavior has been fueled by the growth of digital payment options. Different payment methods such as credit cards, debit cards, net banking, UPI payments, and e-wallets allow customers to make payments anytime, anywhere. Consumers don’t need cash or cheques anymore to purchase online.
Companies had to start depending on digital payments because of the shift in consumer demand from offline to online. This resulted in reduced operating and processing charges, which has been a boon for the industry.
Such a rise in digital payments has stimulated digitization across sectors, especially e-commerce.
An analysis of how digital payments are driving the business in India –
1. Ease of Use
When it comes to e-commerce, consumers expect convenience. It is one of the motivations for shopping online. Digital payments allow for online transactions without worrying about cash in hand. Customers are more likely to complete their transactions
when there are simplified payment methods. Therefore, payment companies are constantly innovating to empower their consumers. For example, in some cases, wallet balances can be updated easily, and payment can be done in ‘one click’.
2. Increase in Basket size
Have you ever shopped online? The choices are never-ending! There is no space constraint as products are cataloged online. Moreover, seamless payment methods, coupon options, and easy checkout processes have contributed to brands upselling and cross-selling their products online. Today, e-commerce has bought the capability
to replace conventional brick-and-mortar stores.
3. Security
Shoppers expect a frictionless journey and want their data to be protected online. While e-commerce websites are vulnerable to cyberattacks such as DoS (Denial-of-Service), compliances such as PCI DSS help fintech safely process transactions and reduce the risk of fraud. There are multiple ways of security payments, such as
encryption, tokenization, One Time Passwords (OTPs), etc. Taking action to protect data will result in repeat consumers, and they tend to spend more money!
4. Payment Options
Most websites offer more than one payment method allowing consumers to choose what works best for them. This has resulted in a rise in BaaS (Banking-as-a-Service) solutions that can offer loyalty programs and convert page visitors to consumers. Having the right mix of payment options provides a more customized approach and reduces shopping cart abandonment. The industry is continuously evolving, with the tech-savvy generation expecting biometric authentication, smart speaker payments, and contactless payments.
Digital Payments – A Game Changer
Payments are a crucial part of any e-commerce journey. Getting this right is paramount for success. This has generated a broad spectrum of new opportunities for different industries. Fintech companies are vitalizing the e-commerce industry by aiding them in streamlining their operations, providing better service, and reducing costs. Digital payments have exponentially increased across e-commerce platforms, and we can expect this to grow much faster in the next few years. The future of e-commerce is exciting.
