· Offline digital transactions have seen remarkable growth – jumping from 48% to 56% in just one year, marking a significant

· 89% women choose digital modes for online spends; 80% of women entrepreneurs run businesses cash-free, led by UPI.

· Gen Z & Millennials shape the future of digital payments: Nearly half prefer credit cards for rewards and flexibility; 65% apply for a credit card with their first paycheck;

· E-commerce drives credit adoption: 65% of co-branded cardholders choose ecommerce cards for integrated rewards.

· The growth of offline digital payments in non-metros is now almost at par at 50% against 62% in metros.

*The above figures represent the percentage of respondents surveyed.

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”.

Expanding Beyond Metros

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. This momentum is being further accelerated by innovations such as tap-and-go payments, co-branded credit cards, and buy-now-pay-later options, which are gaining mainstream traction driven by speed, convenience and inclusivity.

“India’s payment landscape is evolving rapidly, and we’re seeing this transformation across the entire nation, not just in metros,” said Vikas Bansal, CEO of Amazon Pay India. “The growth in digital payment preference for offline transactions from 48% to 56% in just a year reflects a fundamental shift in consumer behaviour. The rising adoption of co-branded credit cards and the strong preference for digital utility bill payments, at 87%, signal a maturing digital payment ecosystem. At Amazon Pay, we’re enabling this transition through our comprehensive suite of solutions – from UPI and wallet for small value transactions to our Amazon Pay ICICI Bank credit card and Pay Later options, making digital payments more rewarding and accessible for all Indians”

Deeper Consumer Adoption

Digital payments are becoming the default choice across urban India, extending beyond online shopping into everyday transactions. Offline digital payment adoption has surged from 48% in 2024 to 56% in 2025, as consumers embrace UPI, cards, and contactless modes in physical stores. The shift is particularly evident in credit adoption, with 65% of co-branded cardholders choosing shopping-linked (e-commerce) cards for integrated rewards. In metros, more consumers are aware and using tap-and-go payments, while credit-led methods are gaining traction for big-ticket purchases across electronics, apparel, and lifestyle categories. This marks India’s evolution from cash dependence to a digitally-driven payment ecosystem where convenience and rewards seamlessly merge with shopping experiences.

The report highlights that trust and convenience remain the cornerstones of adoption. Most consumers continue with their chosen payment method because it is simple and reliable, while safety and security are key to driving loyalty. Together, these shifts point to a future where digital payments in India will be shaped not just by access, but by confidence, personalization, and inclusion.The How Urban India Pays report findings underscore a fundamental shift in consumer behaviour. With rising adoption across demographics, enhanced security measures, and innovative payment solutions, India is not just embracing digital payments—it’s redefining the future of money.

To access the full report- click here