NEW DELHI: Do you feel your bills have gone up since you started using e-commerce apps? Don’t worry, you are not alone!A few taps on your phone could mean a bigger shopping bill. Indian households that use online shopping and payment platforms spend 7.5 per cent more every month than those that do not. The gap is even wider when it comes to services and durable goods. However, the shift to online shopping is far from uniform, with digital adoption still closely linked to household income, according to a report by SBI Research.The report found that households using digital platforms spend 23.4 per cent more on services and 24.5 per cent more on durable goods than those that do not.However, not all households have made the move from traditional shopping to online purchases.
Digital shopping still has a long way to go
Less than half of Indian households have embraced online purchases and payments. According to the report, 45.6 per cent of households used online purchase or payment facilities for at least one consumption item, while 54.4 per cent reported no such usage.The income divide is particularly wide. Among households in the bottom 20 per cent consumption quintile, only 25.3 per cent used online platforms. The share rose to 69.5 per cent among the top 20 per cent, leaving a gap of 44.3 percentage points.The findings are based on a fixed-effects log-linear model that accounts for household characteristics and state-district factors.
Groceries make the online basket
When it comes to digital purchases, consumables and services account for the largest share at 39.68 per cent, followed by durable goods at 23.3 per cent. Food items, meanwhile, make up just 7.10 per cent of online purchases.Within the food category, groceries lead digital adoption at 4.29 per cent. The numbers drop for everyday fresh produce, with online purchases accounting for 1.32 per cent for vegetables and 1 per cent for fresh fruits. Dry fruits account for 0.62 per cent, while eggs, fish and meat make up just 0.59 per cent.SBI Research attributed the limited adoption of online platforms for perishable food items to households’ continued preference for traditional retail channels.Many consumers still prefer visiting markets for their daily food purchases.
Clothing takes the lead among online durable purchases
Not all durable goods are equally popular online.Clothing recorded the highest digital adoption at 19.97 per cent, followed by footwear at 12.05 per cent. Online purchases of furniture, medical equipment and recreational goods, however, remained limited.At the same time, services accounted for the largest share of online purchases within the consumables and services category at 37.93 per cent. Fuel and light followed at 15.96 per cent.SBI Research said digital adoption was associated with higher consumption intensity and more diversified household spending. However, the substantial difference in adoption across income groups shows that the shift towards online shopping is yet to reach all sections of the country equally.
