“This significant uptake of alternative payment solutions can be attributed to the widespread usage of mobile wallets, largely driven by UPI, which facilitates mobile payments in real-time simply by scanning QR codes,” the GlobalData report added.
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India, China, as well as the Asia-Pacific region, has seen the popularity of online payment methods for e-commerce soar. Traditional payment methods like cash and bank transfers are getting displaced, as per a report. While China led the way in alternative payments in 2023, India was a close second.
According to a report by data analytics and consulting company, GlobalData, India has seen the fastest jump in alternative payment share in the APAC region from 20.4 per cent in 2018 to 58.1 per cent in 2023, which propelled it to the second place.
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“This significant uptake of alternative payment solutions can be attributed to the widespread usage of mobile wallets, largely driven by UPI, which facilitates mobile payments in real-time simply by scanning QR codes,” the report added.
In APAC, alternative payments are the most popular payment tools for e-commerce payments, thanks to the availability of mobile and digital wallets. While alternative payments are already popular in India and China, GlobalData’s E-Commerce Analytics has revealed that cash-intensive countries such as the Philippines, Malaysia, and Indonesia, are also witnessing a similar trend. However, China and India have higher adoption rates compared to their peers, the report added.
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Shivani Gupta, Senior Banking and Payments Analyst at GlobalData, comments: “While most Asian markets are traditionally cash-dominated, the adoption of alternative payment methods for both online and in-store payments is growing across many markets in the region, outpacing the West. This trend is driven by the rising smartphone and internet accessibility, increasing convenience of electronic payments, and the proliferation of mobile and QR code-based payment solutions.”
As per GlobalData, alternative payment solutions account for more than 65 per cent of the e-commerce transaction value in China, which is the largest e-commerce market globally. In 2018, China had a share of 53.4 per cent, when India was at 20.4 per cent.
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“China is home to one of the most mature mobile wallet markets in the world, with mobile wallets being widely used for day-to-day transactions as well as for online payments. Alipay and WeChat Pay are household names and are widely accepted among the merchants,” the report added.
Other Asian markets like Indonesia, Hong Kong, Singapore, and the Philippines are also seeing high adoption of alternative payment solutions. Gupta said that this trend is driven by rising internet and smartphone penetration, and growing acceptance of digital payments by merchants.
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The convenience, speed and security offered by alternative payment methods, coupled with high expected growth in overall e-commerce market in the region are anticipated to gain these payment tools traction and disrupt the consumer space in the region, said Gupta.
The survey was carried out in the Q2 of 2023, and involved around 50,000 respondents over 18 years of age, across 40 countries.
