New Delhi: A slew of factors ranging from digitization of services using Aadhaar to Reliance Jio’s onslaught on data prices and the impact of the government’s currency exchange exercise have led to a surge in digital payments in India, according to the latest Internet Trends report by Silicon Valley-based investor Kleiner, Perkins, Caufield and Byers (KPCB).

The key trend is the emergence of mobile as the preferred means of payments and consumption over the internet.

This shift is driven by an aggressive push by e-wallet companies such as Paytm, MobiKwik, FreeCharge, a battery of apps run by banks and a growing app-based digital commerce ecosystem that includes online shopping sites Amazon, Flipkart and Snapdeal, utility bill payments through wallets, online banking, movie ticketing (Bookmyshow) and travel sites like Makemytrip, Ibibo, Ola and Uber.

The findings are part of a 353-page report released Wednesday on internet disruption in various domains across the globe. The publisher KPCB is among the older venture capital firms in the valley (1972) and an early investor in fly-away successes such as Google, Twitter, Uber and Snapchat.

The report pegged India’s Internet user base at 355 million—up 28% from last year—with about 80% of data consumption taking place through the mobile. This is the second highest (mobile traffic as a percentage of web traffic) in the world after Nigeria.

Reliance Jio, the telecom firm owned by billionaire Mukesh Ambani, is a major force behind the increased internet penetration, according to the report. Launched in September last year, Jio forced incumbents to slash data rates by half, as it added over 100 million subscribers in less than seven months.

This coupled with demonetization, made the perfect ground for the proliferation of cashless payments.

According to KPCB, transactions over universal payments interface, or UPI, (launched in August last year) have surged to $359 million in terms of value from about $15 million between November (when demonetization was announced) and March. UPI is a government-managed framework for cashless transactions that works through third-party apps.

From the private sector, the country’s largest e-wallet service Paytm more than doubled its user base to 215 million in this period, the report said.

In the month of April, Rs22.3 billion worth of transactions took place over all pre-paid payment instruments combined (count all e-wallets), data from the Reserve Bank of India showed.

The report also highlighted that government initiatives like Aadhaar—a bio-metric citizen mapping programme launched in 2009—and Jan Dhan Yojana (launched in 2015) were instrumental in lifting traditional banking.

Also read: Mobile wallet transactions up 350% by value in March quarter

The report showed that over 1 billion Aadhaar IDs (covering 76% of the total population) have been issued since 2010, and more than 280 million bank accounts have been opened under the Jan Dhan Yojana in three years.

Aadhaar, which has not only reduced the time taken in KYC (know your customer) filings, account opening and applying for government schemes, has saved $775 million in leakages as subsidies are transferred directly to the beneficiary’s bank account, the report said.

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