Digital transformation is growing exponentially in India. Recent research claims that India has completed 25.5 billion real-time transactions in 2020. It is the maximum in the world by a single country. India is way ahead of the second position holder China that completed 15.7 billion real-time transactions. The report also claims that the digital payments in India will capture the majority of transactions with a 71.7% share in India. , as stated by ACI Worldwide, a payment service provider in the US.
Research Findings Related to Online Payments
ACI Worldwide did digital payment-related research and it also provides payment services for big firms. By 2025, the growth of digital payment systems will leave the traditional payment systems very much behind.
The report says that India will perform 71.7% of transactions online by 2025. Cash, cheque and other old payment systems will be limited to 28.3%, says ACI Worldwide.
If we talk about 2020 data, India performs maximum online payments in the world. In 2020, it completed 25.5 billion digital transactions, whereas China had 15.7 billion transactions. In 2020, 15.6% of payments were related to instant payment systems. Other electronic payment systems contribution was 22.9%. The report also revealed that paper-based payments in 2020 had a share of 61.4%
By 2025, the scenario will change completely. As per the reports, the instant payment share will be 37.1%. Electronic payments will be around 34.6%. Cash and other payment systems will be reduced to 28.3%. The report also said that real-time payments will be more than 50% in a total of electronic payments by 2024.
How Digital Payments are Booming in India?
The Indian government is giving great emphasis on digital transformation. There is a strong tie-up between the Indian Government and other institutions like fintech companies, banks etc to enable online payments.
ACI Vice President Said:
“There is a collaboration between the government, the regulator, banks, and fintech in India, which has helped to advance the goal of enabling financial inclusion and also provided rapid payments digitisation for citizens.”
The report further said:
“As the pandemic continues to drive changes in consumer and business behaviours, banks, merchants and intermediaries across the payment ecosystem are responding rapidly, prioritising the shift to digital.”
Globally, India and China occupy first and second place in terms of online transactions. South Korea, Thailand, and the UK stand at third, fourth, and fifth place in terms of digital payments in 2020.
Countries like Brazil, Mexico and Malaysia are changing their traditional payment systems to digital payment systems rapidly. As per the finding, these countries have started using mobile wallets, one of the digital payment system methods.