Online payment solutions provider PayU on Monday said it handled 17 per cent more transactions during the 2021 festive season as compared to the festive season of previous year, while the average spends increased 52 per cent year-on-year (YoY).
Strong sales on retail and e-commerce channels and massive pent-up demand resulted in consumer appetite rebounding, with the company registering a record high of 80 lakh transactions on a single day, the PayU Insights Report - Festive edition said.
The report compares digital payment transaction trends between the festive seasons of 2020 (October 10- November 10) and 2021 (October 1 - October 31). The findings of the report are based on the transactions on the PayU platform.
The report said that consumers are getting much more comfortable with shopping for large ticket items online, and Maharashtra, Karnataka, Tamil Nadu, Delhi and West Bengal are the major states driving adoption of digital payments in the country.
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Maharashtra and Karnataka accounted for 24.5 per cent and 14.8 per cent of the total spends processed. "Mumbai accounted for 20 per cent of total spends this season, Bangalore for 13 per cent, Delhi for 7 per cent, Kolkata and Hyderabad both for approximately 5 per cent. Among smaller cities, Jaipur, Coimbatore, Vijaywada, Pune showed increased volumes of digital payments," it said.
As the travel norms were relaxed and number of individuals vaccinated against COVID-19 increased, the travel and hospitality industry saw a 105 per cent growth in transactions during the festive season.
"India showed healthy appetite for travel as total spends and total number of transactions grew by 61 per cent and 67 per cent respectively, compared to festive season 2020. This was clearly seen in increased demand for different types of transport," PayU said.
While total spends on airlines rose 109 per cent, trains were the preferred mode of travel with a 250 per cent increase in total number of transactions and 200 per cent increase in total spends.
Growth in financial services
As the ongoing IPO boom continued in October with many companies issuing IPOs, the investments through trading and wealth management platforms gained momentum. The total spends processed per day rose 431 per cent.
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In the banking, financial services and insurance (BFSI) category, the number of transactions showed mild increase but spends increased in double and triple digits.
"In banking and insurance, the spends through digital modes increased by 109 per cent. Interestingly, consumers also showed penchant for debt reduction as total spends for credit repayments increased by 50 per cent, while number of transactions increased by 23 per cent," it said.
With theatres reopening across the county, digital payments for movies and events grew 264 per cent growth in total number of transactions and 450 per cent in total spends processed.
Commenting on the report, Hemang Dattani, Head- Data Intelligence at PayU, said, "Online shopping festivals organized by leading e-retailers, positive recovery in markets, and relaxed guidelines on travel and public events spurred digital payments across key sectors. Also, what we are seeing across categories is greater confidence in spending large amounts, which is a great sign for the economy and takes us closer to becoming Digital India."
PayU, which provides payment gateway solutions to online businesses, is regulated by the Reserve Bank of India. It serves more than 3,50,000 merchants with over 100 local payment methods in India, and claims to be the preferred payments partner for nearly 60 per cent of the e-commerce merchants.
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