Small businesses across every sector took a severe hit in 2020. However, a year later, embracing e-commerce and online payment methods has played a major role in keeping small businesses afloat. Digital payment transactions are up by 76 per cent in Jan-Feb-March of 2021, as compared to Jan-Feb-March 2020, as per Razorpay’s report.
The 8th Edition of this report provided a detailed view of the evolving FinTech ecosystem, the digital spending patterns of consumers, and an analysis of how digital payments performed in the last 12 months of the pandemic. The report also delves into a comparative analysis of how different sectors and payment modes performed in 2021, as compared to 2020, when businesses and life were hit by Covid.
Here are some key highlights from the report. All findings in this report are based on transactions held on Razorpay platform between 2020 and 2021.
In Jan-Feb-Mar 2021, Tier-2 & 3 cities and towns continued to contribute over 50 per cent of all online transactions
As tourism opened up, Jammu & Kashmir found itself in the top 10 digitally inclusive States/Union Territories for the first time, with a growth of 36 per cent in online transactions in Jan-Feb-Mar 2021 compared to Jan-Feb-Mar 2020, ranking above Uttar Pradesh, Madhya Pradesh, and Haryana
Payment options such as Buy Now Pay Later (BNPL) saw a whopping growth of 569 per cent in the last twelve months, owing to consumers avoiding bulk payments and preferring affordable payment modes
UPI continues to be the preferred payment option followed by debit cards, credit cards, and net banking
While the beginning of 2020 recorded just about 500 transactions in eNACH payments, a new payment service that allows anyone with a bank account to easily automate recurring payments. It saw a growth of 23,962 per cent in Jan-Feb-Mar 2021, compared to Jan-Feb-Mar 2020.
The travel industry has truly made a comeback with a 52 per cent growth in Jan-Feb-Mar 2021, compared to Jan-Feb-Mar 2021, indicating some stability in the travel & hospitality economy, and also bringing respite to millions of people working in the sector
In the last few months, consumers have increasingly been ordering online and with that F&B industry witnessed the growth of 69 per cent from January to March 2021
Schools, colleges, and online educational institutes have increasingly been accepting online payments for fees & salary payments; reflecting a 40 per cent growth in online transactions in Jan-Feb-Mar 2021, vs Jan-Feb-Mar 2020.
Real-estate saw an increase of 65 per cent in Jan-Feb-Mar 2021 vs Oct- Nov-Dec 2020, after a 14 per cent decline in the last 6 months of 2020 compared to the first 6 months, showing green shoots of recovery for the sector this year
Mutual funds were the preferred choice of investment for salaried professionals, as the industry saw a 69 per cent growth in Jan-Feb-Mar 2020 vs Oct- Nov-Dec 2020, signifying increased interest to save taxes before the fiscal year ended and live financially healthier lives
"Small businesses are providing newer payment methods and reaching out to a wider customer base that transcends geographical boundaries. All this is enabled by the convenience of digital payments, and we at Razorpay are humbled to support small businesses in their growth journey as Indian businesses and consumers together begin to build a Digitally Inclusive Nation,” said Vedanarayan Vedantham, Head of SME business, Razorpay.
