Indian Online Shoppers Now Prefer Cards Over Cash: Visa Survey

A majority of Indians who make online purchases prefer making payments through credit or debit cards rather than cash-on-delivery or online banking modes, says a survey by financial services firm Visa.

"About 74 percent of the respondents preferred using payment cards - credit, debit and prepaid - to pay for their online purchases, while only 51 percent used cash-on-delivery, followed by 47 percent who used net banking," the survey said.

Online shopping saw significant growth in 2014, with 92 percent of Indians having bought products from virtual stores, making an average of 25 buys, it said.

The use of payment cards is a noteworthy shift from cash, which has historically been the preferred medium for payment, it added.

The findings were based on a survey of 806 Internet users who access the web at least once a week and are aged between 18 and 55. Of the people surveyed, 75 percent were from tier I cities and the rest from tier II towns.

"E-commerce is thriving in the country with Visa spend data showing 33 percent growth in e-commerce payment volume in 2014. We are also seeing 49 percent growth in the number of e-commerce transactions, which is consistent with our research findings," Visa Group Country Manager (India and South Asia) T R Ramachandran said.

The top three reasons for shopping online are convenience (82 percent), price (78 percent), and enjoyment (76 percent).

The study showed that Indians spend five hours online each day, slightly greater than the daily average of four and a half hours across Asia Pacific.

The top three categories for online purchases in the country emerging from the survey were - fashion (51 percent), online bill payments (50 percent) and movie tickets (47 percent).

Personal electronics and computer equipment are the other leading online shopping categories, it said.

The findings also highlighted how online shopping habits vary, depending on the device used.

"Indians are among the most active online shoppers using their mobile phones with 66 percent browsing shopping websites and 46 percent actually making purchases," it said.

Desktops and laptops continue to be the most preferred option for online shopping with a 92 percent to 87 percent conversion rate between browsing and purchasing online, respectively.