70% growth in e-payments

Value of India e-payment market is predicted to grow to between US$ 150 billion and US$ 180 billion by 2010, representing 2-year growth of 70% according to research and consulting firm Celent.

Low number but high value transactions

Celent's report, "Payments in India Going e-Way" shows that while cash is king - 63% of total payments by volume are made using Rupee's - transaction value is weighted in favor of electronic payment methods, 75% of payment value comes from e-payment.

Debit and credit cards

This sea change in buying behavior will be reflected in adoption of debit and credit cards. The debit and credit card market grew at a compound annual rate of 128.7% between 2004 and 2008.

Celent estimates India has 130 million cards in circulation and that this figure will hit 210 million by end of 2010. Of this overall figure 169 million will be debit cards (up on current figure of 102.4 million), the remaining 40 million will be credit cards, up from 27.5 million.

Despite the difference in numbers, total credit card transaction value is set to eclipse more popular debit card transaction value. It can only be hoped that a preference for credit doesn't become a reliance on credit, a scenario facing many UK consumers, the BBC report that UK personal debt now totals close to £1.5 trillion.

India's youth driving change

As with nearly all growth industries in India, the country's young population is responsible for shaking up conventional consumer behavior, estimates suggest 18 - 25 year olds contribute 46% of all online bill payments.

Having grown up with technology e-payment is the norm. Increased internet use has removed borders, and easy to use PayPal is making international internet transactions safe as well as convenient.