An estimated 23.5 billion mobile wallet transactions are expected to occur in 2020.

Mobile wallet adoption is gradually displacing cash and cards in India, a phenomenon that became even more prevalent during the current COVID-19 crisis.

Mobile wallet transactions in India is expected to reach $1.41t in 2024 (INR100.6t), more than double the $5.4b (INR384b) recorded in 2016, according to GlobalData’s Payment Instrument Analytics.

In terms of transaction volume, an estimated 23.5 billion mobile wallet transactions will be carried out in 2020. Total transactions is expected to hit 54.7 billion in 2024.

The rising smartphone penetration and increasing populariy of mobile wallet brands will support these numbers, said Ravi Sharma, lead banking & payments analyst, GlobalData.

“Mobile wallet usage is all set to disrupt the overall consumer payment space in India. Whilst the government’s demonization move (making 500 and 1,000 rupees notes illegitimate) in late 2016 had set the precedent, further decline in cash usage could be seen during the current COVID-19 crisis,” Sharma noted.

“Increasing smartphone penetration, widespread QR code infrastructure and rising consumer and merchant preference for electronic payments will further accelerate this trend,” he added.

For example, mobile wallets are now widely accepted by merchants of all sizes, from big supermarkets to neighborhood kirana shops.

This acceleration of electronic payments aligns with the key objectives of the government’s ‘Digital India’ campaign. The country has been substantially in building long-term infrastructure for cashless payments, the report said.

The introduction of Bharat QR, an interoperable QR code by the National Payments Corporation of India also marks an important milestone for mobile wallets in India and is expected to pave the way for significant usage of digital payments platforms.

The recent COVID-19 outbreak only further accelerated this trend as consumers are increasingly using wallets to avoid physical contact

GlobalData’s latest payment study found that amongst brands, Google Pay is the most preferred mobile wallet brand with more than 43% of the respondents having this wallet, followed by Paytm (36%).