This has been accelerated by the coronavirus pandemic as consumers preferred online shopping platforms

E-commerce sector is thriving in India: report. Source: unsplash.com

Between 2021- 2025, the country’s e-commerce sales are likely to have an annual compound growth rate of 18.2%, according to GlobalData. In 2025, the growth will reach INR8.8 trillion, an equivalent of US$120.1bn.

In 2020, the e-commerce market in India had a 12.2% growth rate. The market has an estimated growth rate of 16.8% to reach INR4.5 trillion, an equivalent of US$61.5bn.

The coronavirus pandemic has contributed largely to this growth. With the closure of borders and social distancing guidelines, consumers were forced to adopt online shopping channels.

The e-commerce market penetration in India has also been supported by a rise in digital literacy, smartphone penetration and increased internet use. This made e-Commerce sales surge despite the pandemic. Various sectors including the hotel and tourism were negatively affected by the pandemic. Other vital sectors including healthcare and the purchase of retail products boomed.

The major e-commerce players in India including Amazon, Flipkart and BigBasket had a surge of orders since the onset of the pandemic. This led to the rise in digital payment options. In June 2021, a QR code-based payment method was launched by Flipkart. This was perfect for consumers who need to switch to UPI-based remittances as opposed to cash on delivery.

Payments that allow consumers to buy now and pay later for their products have also become popular in India. Amazon Pay Later and other firms including Simpl, LazyPay and ePayLater are also offering similar products. While the pandemic caused adverse effects on some economic sectors, it accelerated digital purchases as well as payments in India.

We’ve reported that Russian fintechs will use Open Banking APIs.

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