Digital payment volumes surge 35% in FY25
Srinagar: Digital payment volumes in urban India rose 35% in FY25, led by women, young professionals, and small-town consumers embracing new ways to pay digitally, according to the “How Urban India Pays 2025”report released today by Kearney India in collaboration with Amazon Pay.
The report highlights how aspirational buyers are broadening digital transactions across spending categories, with digital methods now preferred not just for high value purchases like electronics and apparel but also for recurring categories such as utility bills (87% in 2025 vs 83% in 2024), reshaping the payments landscape as India moves toward a $7 trillion digital economy by 2030.
Women, Gen Z & Millennials Driving Change: Women are emerging as powerful drivers of this transformation, with 89% preferring digital modes for online purchases, a shift from earlier reliance on cash.
This trend extends to women entrepreneurs, where 80% run their businesses digitally, with UPI (34%) leading the charge, followed by cards (20%), and wallets (8%).Affluent women are also displaying a greater inclination toward credit-led transactions — 69% prefer credit cards, drawn by rewards and financial flexibility — while middle-income segments continue to favour UPI and wallets for their everyday spends.
“India’s digital payment revolution is accelerating at an unprecedented pace, with retail digital transactions set to cross $7 trillion well before 2030”, says Shashwat Sharma, Partner and Financial Services Lead, Kearney India.
“Digital payments is preferred for 90% of online purchases and is rapidly reshaping offline spends too. Our consumer insights reveal that with growing financial independence, 57% of women are actively taking charge of their finances and 80% of women entrepreneurs now prefer to run their businesses cashless.
Gen Z and Millennials are redefining credit adoption in India. 65% of respondents applied for their first credit card early in their careers.” He further added, “Moving forward, the next big opportunity lies in building trust, personalization, and inclusive financial products — opening immense growth potential for businesses and ecosystem players ready to tap India’s digital-first future”.
The report finds India’s digital story deepening outside metros, with offline usage in small towns rising to 50% in FY25, compared to 62% in metros. Tier 2 cities such as Lucknow, Jaipur, Kochi and Bhubaneswar are rapidly catching up with metros, reflecting strong digital payment openness and transaction growth.
