88% of Indian consumers use mobile devices to make purchases or pay online: PayPal & IPSOS mCommerce Report

PayPal released a report titled, The mCommerce Report. The study conducted by Ipsos and commissioned by PayPal, analysed the latest trends in mobile commerce (mCommerce) across the globe and India. India has emerged a forerunner in mobile commerce adoption in comparison to its global counterparts.

The survey conducted across 11 countries with approximately 22,000 consumers and 4,000 business respondents examined how people shop and sell online.  In India, the respondent pool comprised of 2000 consumers aged 18-74, who owned or used a smartphone and over 300 business influencers or decision makers who sell or accept payments online. The research offers insights on mobile commerce, mobile shopping experience, social commerce, cross border shopping and contactless payments in India. It provides a view into key trends related to mobile shopping habits and merchant readiness – drivers and barriers, how security remains top-of-mind for consumers.

Anupam Pahuja, Managing Director, PayPal India, said: “India has been rapidly moving towards digitization and millennials are embracing innovative ways of transacting using technology.  We at PayPal, are focused on enabling seamless and safer transactions to become a part of the daily lives of Indian consumers. Mobile penetration gives an impetus to the adoption of digital payments across the country.”

Mobile commerce: Indian consumers prefer using a mobile device for purchases/ payments

  • Compared with other markets surveyed, India leads the way with 70% of consumers preferring mobile-optimized experiences vs the global average of 43%
  • 81% of the merchants are optimized to accept mobile payments to meet the growing demand and responding to consumer preferences vs the global average of 63%
  • 88% of the surveyed Indians use a mobile device to make payments, way above the global average of 71%
  • Apps are a popular way of transacting wherein 98% of Indian mobile shoppers pay via apps vs 90% of the global average. Bill payments and fashion are the key sectors where app purchases take place
  • According to the report, 81% Indian businesses are optimized to take mobile payments and 45% of Indian businesses have listed down mobile optimization as a priority

Social commerce: The next big game changer

  • Social commerce adoption has been increasing in India with over half of the consumers, about 57% having purchased via this channel in the past 6 months, with over half of them doing so weekly
  • This is led by the young – 54% Gen Z and 61% Millennials. Spends are highest in the fashion sector with WhatsApp and Instagram being the most frequently used platforms
  • India has been a frontrunner when compared with other markets wherein 62% of Indian businesses accept payment via social media vs global average of 35% and 55% of their sales volume is generated via social media vs global average of 45%
  • Nearly all business respondents use social media for promotion, but fewer do it for sales
  • Over 40% of businesses are worried about data security on social media, which acts as an obstruction for entry 

The Mobile shopping experience: All age groups rely on their smartphones with a high level of browsing among mobile shoppers 

  • According to the report, 47% millennial mobile shoppers have made spontaneous purchases on their mobiles
  • 39% business respondents in India have an app vs 24% global average and 51% of online sales volume in India is driven through in-app purchase vs 41% global average
  • Slow page loading and security or trust issues emerged as the top barriers for consumers to make payments through mobile devices. The report also suggests that consumers resorted to mobiles mainly for fashion and paying bills

Cross border shopping: More than half of Indian consumers shop cross-border

  • 54% online shoppers and 55% of mobile shoppers shop cross border
  • On an average, Indian online business respondents received 47% of sales from international customers in the last 6 months
  • Better product quality and ability to discover new and interesting products variety are key drivers for cross-border shopping, however, shipping costs, delivery time, lack of clarity on duty/ taxes/ and return shipping costs are some of the barriers for those who do not shop internationally
  • Majority of consumer respondents (6 in 10) also mentioned that PayPal’s availability as a payment option are more likely to continue with the transaction and 34% consumers are not very likely or not at all likely to purchase without PayPal
  • 27% of the merchants surveyed actively target international buyers and 26% feel that selling to an international customer base has a positive impact on their business growth

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