‘India leads in digital wallet adoption’
US-based payment solutions company Blackhawk Network believes that the mode of digital payment that the retailer uses will be a deciding and influencing factor in a purchase
Digital payment adoption is growing, fueled by India’s mobile-first population and the onset of the pandemic, which further created an urgent need for contactless payments in everyday transactions. The need for digital payments with changing behaviour around payment platforms has shown interesting trends in retailer loyalty and consumer payments, Theresa McEndree, global head, Marketing, Blackhawk Network (US-based payment solutions company) tells Y V Phani Raj in an interview. Excerpts-
Digital wallets
As per Blackhawk Network’s Global Digital Payments Study that featured India as a prominent geography, the growth in digital wallets, their broader usage, and acceptance in India was higher than in any other surveyed region. Study showed 93% of Indian respondents used digital wallets frequently in the last 12 months, which is way ahead of the 55% global average. The primary reasons for this shift were convenience and safety – the fact that they can use digital wallets both in-store and online in a contactless manner. This also led to 20% of Indian respondents becoming first-time digital wallet users in the past one year.
Gift cards
With 50% of Indian shoppers surveyed buying gift cards for themselves just to make purchases online, gift cards proved to be an effective payment method while driving traffic amongst shoppers. QR codes also emerged as one of the most-used digital payment tools during the pandemic with 85% of Indian respondents using them frequently over the last year.
Covid impact
The pandemic has provided significant tailwinds to India’s digital transformation and payments ecosystem. The retail and the e-commerce sectors saw a direct impact as shopper’s preferences and behaviour evolved. Many consumers engaged with them during everyday purchases such as grocery and online shopping. Digital wallets did not have much traction prior to the pandemic. Now 94% of Indian respondents utilise and agree that online shopping has become easier through digital wallets.
Offline retail
With people mostly confined to their homes, the pandemic led to people spending more on services such as hyper-local delivery apps owing to increased digital consumption. Retailers that cater to a consumer’s needs during the pandemic have an opportunity to build loyalty and connections that will last. Small/offline retailers can unlock significant value by making or receiving payments in a strategic manner that attracts rewards, drives efficiency, or optimises processes.
Future outlook
The uptick in purchasing essentials through online platforms may impact overall consumer demand, and consumer spending trends will hinge on the nature of the post-pandemic life. The mode of digital payment that the retailer uses will be a deciding and influencing element in a purchase as 91% of Indian shoppers surveyed are more likely to shop at a retailer if they accept the digital payments that they use. Merchants and retailers would need to attune to these shifts in trends as consumer spending behaviour evolves.
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