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The online payments market in India has undergone a sea change in the last few years. The growth rate of e-commerce and digital payments has reached new heights and the Indian payments market is experiencing dynamic growth. Hence, it is crucial to understand the way forward.

During the New Crown epidemic, many users turned to online payment methods as an alternative due to travel and direct contact constraints. However, recent studies have shown that users are no longer returning to cash payments. Currently, India is at the forefront of the e-payment market and is bound to witness significant trends in the future. From the growing popularity of Buy Now Pay Later (BNPL) to the popularity of security tokens, the future of digital payments looks bright and full of opportunities to flourish.

In fact, the e-commerce payment scenario in India had started changing even before the epidemic.In 2019, India recorded the highest number of fintech companies set up. Over 651 TP3T fintech accounts were registered in the last five years. According to the report, the payments industry in India could grow by 3,00% by 2025, with two out of every three transactions switching to online.

So what are some of the most popular online payment methods?

As public demand grows, catering to these needs is critical to the success of any business. Currently, two out of every five transactions in India are digitised, and projections show that this number will be more in favour of digital payment services. Similarly, many online payment options offer a more efficient cashless approach.

**Tokenisation**

Tokenised processing is becoming a trend over time. The process converts sensitive data into equivalents and replaces them with tokens. Since the token does not contain any of the original sensitive data, it is useless to someone trying to steal the data. Therefore, the token serves only as a symbol of the original data. This will not only reduce the risk of future fraud, but will also increase customer trust in the company. This process is more common with card tokens, bringing the future closer to complete digitisation.

**Buy now, pay later**

The BNPL option is becoming increasingly popular amongst Generation Z. The BNPL option is a great way to make your credit score more affordable. The simplicity of the process has made the BNPL industry a huge success in a short span of time.BNPL options not only make things more affordable but also do not affect the credit score in most cases. They have made BNPL the first choice in many cases.

**Digital wallet**

Digital wallets are another electronic payment option that will grow significantly in the future. Because these options eliminate the need to open a physical bank account, it is easier for users to make online payments. Digital wallets make online transactions easier by storing all sensitive information compactly and securely. These wallets work primarily with Near Field Communication (NFC) technology. This technology allows devices in close proximity to easily communicate and share data. Digital wallets will make contactless payments easier.

How can payment gateways make the payment space more user-friendly?

When we talk about the future of ease of online payments in our country, it is vital to consider every part of the country. The gap between urban and rural India is narrowing thanks to better options, ensuring that every citizen can easily shift to the digital economy. While we are getting closer to being fully digital, there are still some barriers such as the fear of fraud or the language interface that online gateways mainly offer.

It is critical to make the space more inclusive by eliminating the problems that arise from language restrictions. One such option is Checkout India. This personalised payment solution prevents language from being a barrier to full digitalisation. Indian Checkout allows users to choose the language of their preference, offering a choice between English, Hindi, Bengali, Marathi, Telugu, Tamil, Gujarati and Kannada.

Personalised user experience and the rise of 'super' apps

The future of digital payment services offered a safer and more inclusive space for all, and payment gateways offering such options would play an important role in the digital economy. Offering language options will help the public and businesses provide a better user experience. It could even be an enabler for businesses focused on rural and semi-rural areas.

Meanwhile, payment apps are rapidly offering more personalised options. The future may go beyond traditional payment methods. Many payment partners are looking to "super apps" that provide detailed customer data to deliver highly personalised services. Globally, mega-apps are evolving into online transaction ecosystems, and India's growth will be interesting to watch.

How can India secure the future of its digital payments?

Cash will no longer be a running factor in the market. The risk of online fraud is also likely to increase as the country moves towards full digitalisation.

Ensuring stringent security measures is also crucial in driving the growth of online payment methods. Biometric authentication helps in keeping the transactions secure to a great extent.

**Biometric authentication**

Biometric authentication includes fingerprint recognition, facial recognition, iris recognition, heart rate analysis, and more. Due to the unique biometric support, the method aims to build a secure system. It is considered to be an effective method to combat identity theft and fraud. The system also helps in building customer support and brand trust.

**Central KYC**

Currently, KYC also plays a role in preventing users from signing up for electronic payment options. A complete KYC requires physical biometrics or video call along with other requirements. With the introduction of CKYC or centralised KYC, customers will only need to go through the KYC process once to access different services. After that, the KYC records will be stored in a centralised facility for future use.

reach a verdict

According to a report by the National Payments Corporation of India (NPCI) in 2021, the online transaction industry reached Rs. 8 trillion and this number will only increase in the future. The online ecosystem is likely to grow to $1 trillion by 2026 and India's journey will undoubtedly witness more innovations in the future.

common problems

Is India ready to fully digitise its payment system? Many payment gateways have experienced a large number of users in the last few years. Digital payment systems are becoming more and more secure and through personalised language and user interfaces, the process is becoming more and more accessible to all. What online payment options are available? Payment gateways like PayU offer different online payment options such as credit cards, debit cards, net banking, BNPL, Bharat QR, net banking, instalments, wallets, UPI, and more. These options are offered according to the user's preference.