The eCommerce market in India would be growing leaps and bounds in the years to come as the post-pandemic market conditions look significantly promising.
By 2024, India’s eCommerce market is projected to grow 84% to reach $111 billion by 2024, according to the latest report from FIS, a financial technology firm.
The report emphasised the fact that the changed market conditions due to Covid-19 are playing a vital role in the growth of the eCommerce industry in India. People have become more accustomed to online shopping and digital payment now and this will provide a required push to India’s eCommerce industry.
“E-commerce capability is no longer limited to just traditional websites, and physical retail has blended with the digital world. The shop floor is now in the palm of our hands and consumers expect the same hassle free and convenient shopping experience whether they are purchasing in app, through their social feeds or in the real world,” said Phil Pomford, managing director of Asia-Pacific, Worldpay from FIS.
India eCommerce Market: Mobile Shoppers
The report, which has analysed the global payment trends across 41 countries, highlights that mobile shoppers would be the key to the growth of the eCommerce market in India in the years to come. It is estimated that mobile shopping would clock 21% yearly growth rate over the next four years.
The eCommerce market in India touched $24 billion in 2017, all thanks to the healthy growth in the organised retail sector estimated $795 billion market then. The retail market dynamic has changed in the last one year. Mergers and acquisitions are only painting a promising picture of the sector. It’s estimated that India’s retail sector would be a $1.2 trillion market in 2021.
All such developments in the retail sector will have a direct impact on India’s eCommerce market as well, which still accounts for a minuscule share of the retail market.
The FSI report also highlights the trends in online payment methods in India. Digital wallets emerged as the most mode of online payment among online shoppers with 40% share in 2020. Credit and Debit cards accounted for 15% each.
The report also depicts that the unprecedented adoption and usage growth of digital wallets during Covid era will result in 7% point increase in the market share of digital wallets by 2024.
When it comes to in-store shopping, the payment trends change significantly. Digital Wallet is no more the most preferred option for walk-in customers despite the fact that most stores are equipped with all forms of digital payment collection mechanism. With 34% share Cash is still the most preferred payment option for in-store shoppers, followed by digital wallets which account for 22% of total in-store payments.
The report, however, paints a very promising future of digital wallets and claims it will take over Cash as the most preferred payment option with a 33% share for in-store shoppers by 2024.
Undoubtedly, the eCommerce market in India is flourishing despite the fact that it has only scratched the surface yet. The exploded adoption of smartphones with high-speed internet connectivity has created a big window of opportunity for all the eCommerce companies operating in India. Sensing the favourable market conditions and the perfect time to hit the nail, eCommerce companies are gearing up to reap the most of it by going public in the next few years. The much-awaited Flipkart IPO that could value the company as much as $35 billion could be the biggest success story of an Indian startup soon.
All said and done, India’ eCommerce industry growing leaps and bounds and Covid-19 has turned out to be blessings in disguise for all companies in this space.