Indians embrace e-payments, but prefer security to discounts

Indians are among the most open in the Asia-Pacific region to using emerging digital payment methods, with 93% consumers likely to have used at least one mode of digital payment in the past year, showed a new survey commissioned by Mastercard.

Only the Chinese did better (98%), showed the survey conducted over March and April among 7,004 adults evenly distributed across seven markets.

In India, digital wallets were the preferred payment method, with 58% saying they had used them at least once in the preceding year. The usage was even higher among the affluent (64%) and millennial (63%) respondents.

Among Indians, other emerging methods such as QR codes and digital money transfer apps also had over 50% share. Cash was the third most favoured method with a 51% adoption, while other traditional modes such as in-person credit, debit, or pre-paid card or contactless card had less than a one-third share.

Respondents could pick multiple options.

The survey had 52% male respondents and 48% females. In terms of age group, it comprised 37% Gen-Z (age 18-25), 48% millennials (age 26-43), and the rest older. The survey’s findings—‘Global New Payments Index’—were shared exclusively with Mint.

Indian consumers are making purchases in diverse ways, with a range of digital purchasing activities at play. But purchasing from an online marketplace tops the charts with 56% of the respondents claiming to have done so using a digital payment tool.

Nearly half (48%) said they had bought something via a mobile app, while around 55% reported using a merchant-specific payment tool, such as loyalty points or store credits.

Overall, 91% of respondents had made at least one digital purchase in the six months preceding the survey.

But security is paramount for consumers, far more than the reward points and freebies they can get for making purchases. While 42% of the respondents keep security at the top of their mind when deciding which payment method to use, only 32% prioritize best rewards and 25% discounts and promotions. Millennials are more likely to look for rewards (37%).

Overall, 39% look for ease of use, though this share was higher (45%) among generation-X (those aged between 44 and 57 years).

Low interest rates and airport lounge access influence just 15% and 11%, respectively, when they look for which payment method to use.

Despite increased digital adoption, cash is still considered a “very” or “somewhat” secure payment method, with 76% believing so, with an even greater share (82%) among older users (44-57 years). That said, emerging digital payments are moving head-to-head. Making a payment using a QR code is believed to be as secure as cash, with 76% endorsing it, while 73% view digital money transfer service as a secure method. Among millennials, 76% see swiping a card as secure.

Around 59% believe tapping a payment-enabled wearable technology device is “very” or “somewhat” secure, and 54% view a payment using cryptocurrency as a secure payment method—the bottom of the list among the options given by the survey.