The e-commerce transaction value is expected to rise from $6 trillion in 2022 to over $8.5 trillion in 2026, exhibiting a compound annual growth rate of 9 percent, according to the FIS Global Payments Report 2023.
While the rapid growth witnessed during the initial years of the pandemic has slightly slowed down in 2022, with a 10 percent year-on-year growth, the forecast for global e-commerce remains optimistic.
With the exception of Europe, all regions experienced double-digit growth in e-commerce transaction value from 2021 to 2022. The Middle East and Africa recorded the highest growth rate at 21 percent. Markets in Latin America, the Middle East, Africa, and Southeast Asia, with the exception of Thailand, continue to exhibit high growth potential.
The e-commerce transaction value in India is expected to experience significant growth, increasing from $83 billion in 2022 to nearly $150 billion in 2026. This represents a compound annual growth rate of 16 percent. The report also projects that the Philippines, Indonesia, India, Malaysia, and Vietnam will lead e-commerce growth in the Asia-Pacific (APAC) region until 2026.
India has emerged as a global leader in payments, with the development of the Unified Payments Interface (UPI), a project undertaken by the National Payments Corporation of India (NPCI) and the Reserve Bank of India (RBI). UPI’s success can be attributed to its seamless interoperability with popular commercial wallets like Google Pay, Paytm, and PhonePe.
In India, the Open Network for Digital Commerce (ONDC) is an initiative led by the Department of Promotion of Industry and Internal Trade (DPIIT) at the Ministry of Commerce. Its aim is to revolutionize digital commerce and enhance the penetration of retail e-commerce in the country. The Ministry of Electronics and IT (MeitY), through the Common Services Centres (CSC), has also invested in the ONDC to promote e-commerce and logistics in rural areas. Currently, the ONDC network boasts over 40,000 active sellers across more than 200 cities.
However, the report highlights that certain emerging markets face challenges in terms of digital infrastructure and financial inclusion, which can hinder the growth of e-commerce. Additionally, regulatory obstacles and cross-border trade barriers pose challenges for businesses seeking to expand globally.
