Digital Public Infrastructure (DPI) in India such as Aadhaar, eKYC, and UPI have transformed governance and fueled the growth of the startup ecosystem. Aadhaar enabled efficient delivery of government services and benefits, saving an estimated $34 billion. UPI became the dominant digital payment method in India, driving financial inclusion. DPIs have also impacted private businesses by streamlining operations and enhancing customer experiences. Emerging DPIs like ONDC aim to further democratize commerce across sectors. The synergistic relationship between DPIs and the startup ecosystem is poised to propel India's digital transformation and economic growth.

1. Impact of
DPI on the Indian
Internet Economy
© 2023 Redseer Strategy Consultants Confidential and Proprietary Information
Dubai. Bangalore. Delhi. Mumbai. Singapore. New York
December 2023

2. 02
© Redseer
Foreword
India today is a digitally progressive, formal, high-productivity mega economy, with the Digital
Public Infrastructure (DPI) serving as its foundational element. Since their inception in 2009
with Aadhaar, DPIs have continued to enhance the ability of the nation to use digital
technologies at population scale to transform many facets of the society.
Aadhaar, eKYC, and UPI lie at the heart of transforming India across all developmental and
economic fronts by not only extending access to governance, banking, mobile internet, and
commerce to all, but also creating jobs, and attracting capital. In doing this, India achieved in 9
years what would have taken 47 years by traditional means.
While the role of DPIs in governance is well understood, DPIs have also had a transformative
impact on the Indian startup ecosystem and created tremendous value for the startups,
employees, consumers and funds. The democratized digital ecosystem enabled by DPIs has
fuelled market innovation and the number of startups in India has surged over 100x from 2016
to 2023, capitalizing on these open frameworks to generate business value.
This report by Redseer highlights the synergistic relationship between the startup ecosystem
and the Digital Public Infrastructure. It provides a measure of the economic impact and benefits
of mature DPIs across different startup sectors, and the disruption potential of emerging DPIs
like ONDC going forward. This symbiotic relationship will be critical to drive adoption of digital
services across all facets of society, drive more equitable opportunities for all and play a
critical role in propelling India to a USD 10 trillion economy.
Nandan Nilekani
Chairman and Co-founder Infosys,
and Founding Chairman UIDAI (Aadhaar)

3. © Redseer
Over the past several years, India has embarked on a remarkable journey towards becoming a
digitally enabled society. This digital transformation has not only reshaped the nation's
socioeconomic landscape but also served as a global model for how technology can be
harnessed to uplift and connect diverse and large populations.
At the heart of this transformation lies the concept of Digital Public Infrastructure (DPI), a
strategic framework that has provided the rails to propel India onto the global stage as a digital
powerhouse. This has been accelerated by increased access to smartphones and highly
affordable mobile data that benefitted nearly 800 million people.
Aadhaar was the linchpin for this digital evolution and facilitated easy digital verification at
population scale for a range of services through eKYC. Aadhaar's impact on effective
governance has been remarkable and resulted in substantial government savings by plugging
the leakages in the system. The next game-changer was the Universal Payments Interface
(UPI). UPI democratised digital payments at a speed and scale that was unimaginable even 10
years back. This led to rapid digitization of small businesses and mass proliferation of online
payment among consumers.
The stupendous success of Aadhaar and UPI has spurred the launch of several DPIs at
different stages of development. These include Digilocker, Fastag, ONDC, AA and Diksha,
amongst others.
DPIs have not only transformed governance but have also ushered in a plethora of new
opportunities for the private sector including startups. This report specifically endeavours to
highlight the synergistic relationship of DPIs with the Indian startup ecosystem.
Startups have been among the early adopters of the ‘digital’ and ‘public’ nature of DPIs and
leveraged it to create innovative services and process changes to lower costs and expand the
reach of their services to all corners of the country. The speed of DPI adoption has helped
them scale rapidly and, in many cases, upstage the traditional players in their sectors. Our
analyses reveal that DPIs have helped unlock value of over USD 100 billion in Indian startups
across sectors.
UPI has been the raison d’etre for several large-scale payment platforms with hundreds of
million users. eKYC and UPI have democratized financial investments enabling customers from
the remotest parts of the country to securely invest in financial assets. They have also
transformed lending to the masses by easier access to and lower costs of loans through
digital channels driving a surge in small-ticket loans. As the landscape evolves, the launch of
credit on UPI promises even easier access to credit for a large user base, fostering the
development of innovative financial products. Beyond finance, UPI and eKYC have played
pivotal roles in propelling all sectors that require customer verification, digital payments, or
subscriptions. These include the OTT audio/video platforms, online gaming, eCommerce, and
other subscription economy-driven businesses.
03
Executive summary (1/2)

4. As the next wave of transformation looms, ONDC stands out as a potential disruptor, poised to
democratize eCommerce across sectors and potentially generate USD 250-300 billion in GMV
by 2030. Anticipating the future, we expect the next wave of DPI-driven opportunities in Retail,
Insurance, Healthcare and AgriTech. Startups will also combine different DPIs in innovative
ways to create totally new offerings or fundamentally improve the existing offerings in terms
of costs, speed and experience.
With the Indian internet economy projected to reach USD 1 trillion by 2030, DPIs are primed to
continue playing a significant role in democratizing this growth and ensuring a digital future
that is inclusive and expansive.
Executive summary (2/2)
04
© Redseer

5. and Jan Dhan bank accounts, in addition to the
Aadhaar ID – collectively referred to as the JAM
trinity. Today, over 97% of the Indian population
possesses a digital ID, with nearly 50% owning
smartphones, and approximately 40% having
access to banking services.
Aadhar bolstered the Direct Benefit Transfer
framework and policies through which the
Government of India extended support to more
than 900 million beneficiaries, amounting to USD
400 billion in cash and in-kind benefits across 313
schemes. The removal of fake and/or duplicate IDs
led to an estimated USD 34 billion in savings for the
government. Additionally, Aadhaar-based eKYC
procedures streamlined processes such as bank
account openings, issuance of credit cards, and
filing of income tax returns, digitizing various facets
of government-citizen interactions.
Introduction to India’s Digital Public
Infrastructure
In a decade of rapid technological advancements,
India's transition to a digital economy has been
revolutionary. The journey that started with a digital
identity card has now shaped every aspect of how
Indians live. This transformation has been
accelerated by increased access to smartphones,
Aadhaar, through the easy digital verification of ID,
has enabled effective and efficient governance
leading to substantial savings to government.
1.0
05
India’s Digital Story
Aadhaar and Governance
© Redseer
Total DBT
FY20 – FY21
DBT Dashboard
+45%
47 Bn
FY 20
69 Bn
FY 21
Digital Enablement
Source(s): UIDAI Annual Reports, PMJDY Press Release,
FY12
0.13 Bn
FY22
1.37 Bn
~10x
~1.37 billion 600+ million 500 million
Indians are registered on Aadhaar Smartphone users in India Jan Dhan accounts created
FY12
0.13 Bn
FY22
1.37 Bn
~10x
FY14
120 Bn
FY22
600 Bn
~5x
FY14
140 Mn
FY22
500 Mn
~3.5x

6. The integration of Cowin with Aadhaar streamlined
the administration of vaccines in the country,
enabling citizens to easily reserve slots with only
their Aadhaar and mobile numbers. This process
demonstrated remarkable efficiency at scale by
achieving 1 billion vaccinations within 9-10 months.
This proven and established framework serves as a
model for the government to effectively execute
large-scale health campaigns in the future.
06
“Helped by digital cash transfers, India managed to provide food or cash support
to a remarkable 85% of rural households and 69% urban households”
– David Malpass, Former President of World Bank
A Lifeline during the Pandemic
© Redseer
Source(s): Cowin Dashboard, Direct Benefit Transfer Dashboard, World Bank
Covid Vaccines Administered
Cowin Weekly data, Jan 2021 - Oct 2021
CoWIN platform
can be leveraged
for mass health
campaigns
Jan 2021
1.2 Mn
Oct 2021
1000 Mn
Source(s): DBT Dashboard, PIB Press Releases
Jan Dhan Yojna
Direct Benefit
Transfer
eKYC
Authentication
500 million bank accounts opened since 2013
USD 212 billion direct cash transfer to 5.4+ crore accounts created using JAM
340 million RuPay cards issued with an insurance coverage of Rs. 2 Lakh
15.2 billion Aadhar-based e-KYC transactions
16 billion last-mile transactions were enabled by AEPS for low-income citizens
56.3 million (83%) IT returns e-verified through Aadhaar-based OTP
Estimated Savings from DBT – USD 34 billion
42 million duplicate and fake/ non-existent Ration Cards have been deleted
41.1 million duplicate, fake/ non-existent, inactive LPG connections eliminated
10% savings on wages on account of deletion of fake/duplicate beneficiaries
16 million metric tonnes of reduction in fertilizer sale to retailers

7. operations, and a notable shift in consumer
preferences.
A remarkable achievement of UPI lies in its role in
democratizing technology, effectively extending its
reach into the rural hinterlands of India.
Approximately 70% of the existing users of UPI are
from outside the Tier-1 cities with over 80% of the
new users coming from Tier-2+ locations.
With over 350 million users, UPI has emerged as a
highly successful digital public good, altering the
way India transacts. Presently, about 45% of all
payments in the country are digital, within which
UPI commands a dominant share of 52%, crossing
10 billion monthly transactions in volume. The
convenience attached to UPI payments has led to a
large merchant acceptance network, digitization of
07
UPI – The Indian Payment Revolution
This involves centralizing the process and
eliminating redundant procedures at various
touchpoints. Embracing an enterprise-level
approach for MSMEs, trusts, and other entities will
enable companies to alter documents, changes of
which will be reflected in personal DigiLocker
accounts achieving high interoperability.
DigiLocker has expanded its document coverage
across banking, financial services, and education
with the involvement of private sector
conglomerates. Its widespread acceptance
promotes digital literacy, fosters a more
environmentally sustainable and tech-savvy
society.
The successes of Aadhaar, eKYC, and UPI have
spawned various other Digital Public
Infrastructures (DPIs) and the development of India
Stack.
DigiLocker and FasTag are two platforms that are
fairly mature and have garnered significant user
bases, and the ongoing expansion of these
initiatives is facilitating the creation of products
and applications that explore new use cases (e.g.
KYC/ID verification and dynamic linkage of
insurance and heath records through DigiLocker,
parking fee payment using FasTag balance, and
many more).
The government has enhanced the DigiLocker
offering with DigiLocker 2.0, aiming to streamline
the Know-Your-Customer (KYC) process across
financial and alternative services.
Other DPI Initiatives
UPI Transaction Volume
In Bn, FY17-22
Source(s): NCPI Product Statistics, The Economic Survey 2023
0.4
3.7
11
19
39
74
48%
52%
Other
non-cash
payments
FY17 FY18 FY19 FY20 FY21 FY22 FY22
UPI¹
© Redseer

8. Open Credit Enablement Network (OCEN),
e-National Agricultural Market (e-NAM), and
Bhashini. These underscore digitization and
democratization of various facets of India’s
socioecononic fabric including lending and credit,
health, education, agriculture, etc. through Digital
Public Infrastructure (DPIs).
Several other DPIs are at various stages of
development and adoption. These include Account
Aggregator (AA), Open Network for Digtal
Commerce (ONDC), Ayushman Bharat Health
Account (ABHA), Digital Infrastructure for
Knowledge Sharing (Diksha),
they have integrated DPIs in their processes to
enhance their customer interface. Financial
services players such as banking, insurance and
wealth management have been highly impacted,
but other consumer facing businesses such as
retail, travel, telecoms, etc. have leveraged DPIs in
critical processes.
While the transformative impact of DPIs on
governance is well understood they have also had
a large impact on the private sector. They have
influenced operational processes, customer
interactions, financial transactions and fostered a
culture of innovation. As organisations have gone
through digital transformation,
08
DPI's Impact on the Private Sector
© Redseer
Other DPIs
Descriptive
DigiLocker National Statistics, NCPI FasTag Product Statistics, AA Ecosystem Dashboard, ABDM Insights, MOE Press Release
OCEN
USE CASE USE CASE
Digitally stores static user documents: insurance,
transport, finance, education, health, etc.
180 million registered users for 6.14 billion digital
documents
9.41 billion digital toll transactions valuing INR 1.56
trillion were collected
15+ million consent requests have been successfully
fulfilled by AA
Over 150 thousand merchants1 operative on the
platform within one year of launch
45 million ABHA accounts created
200 million students and 7 million teachers served
by Diksha
Launched recently
Cost and time-saving tool for traffic and mobility
ecosystem management
Revolutionizes lending & investing by user consent
based financial data access by Account Aggregators
Democratizes commerce by promoting fair competition,
convenience, & choice
Digital health ID for seamless consent-based medical
record sharing with clinics, insurers, etc.
Education ecosystem management through stakeholder
training & development
Financial marketplace for last-mile credit access by
reducing costs for lenders
Mature
Developing

9. 09
Government and Citizens Private Sector/Businesses
Open Protocol
Public-Private Partnerships
DPIs
Enabled verified bank accounts
through KYC
Easy access of government services
across the country
Efficient and transparent government
benefit transfer – DBT, vaccine, etc.
Creation of new internet driven
business offerings built on DPIs
Increased efficiency, speed and scale
of operations with eKYC and UPI
Democratization of services reach to
customers across India
The impact of DPIs on the private sector has
materialised in the form of streamlined operations
and enhanced customer experiences by leveraging
consumer and business digital footprint.
As businesses continue to adapt to this digital
paradigm, the synergy between DPIs and the
private sector is poised to drive efficiency and
innovation in the ever-evolving landscape of the
modern hyperconnected economy.
© Redseer

10. This sharp increase was paralleled by a steady
growth in the number of internet subscribers.
Simplified subscriber eKYC process facilitated by
Aadhaar had a critical role to play in this rapid ramp
up of Jio,
Impact of DPIs on the Indian Internet
Ecosystem
In the early 2010s, consumers were paying upwards
of Rs. 250 for 1 GB of data. The arrival of Jio in 2015
and the ensuing data price competition drastically
reduced prices by nearly 95%, leading to a surge in
monthly data consumption per user from less than
1 GB to approximately 6 GB within a span of 2-3
years.
Consequently, India also ranks 6th
on user
engagement time on the internet, amounting to an
average of about 5 hours per day.
Mobile data in India is the third-most affordable in
the world and it has a huge internet subscriber
base, second only to China.
2.0
10
The Dawn of the Data Age
© Redseer
The launch of Jio caused data prices to drop drastically with growing
internet subscribers
Source(s): TRAI Annual Reports, Nokia MBIT Index
Average monthly data consumption
In GB
300
250
252
302
343
422
494
637
743
825 829
200
150
100
50
0
800
900
700
600
500
400
300
200
100
0
Cost of 1 GB Data
(in INR)
Number of internet
subscribers (in Mn)
Launch of Jio
in Dec 2015
FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY14 FY17 FY22
Drop in prices from
Rs. 269/GB to less
than Rs. 20/GB
Number of
Subscribers
Cost of
1 GB Data
~19x
19-19.5
5.7
0.3

11. 11
These users actively engage in online transactions
and proficiently utilize advanced services such as
e-learning, telemedicine, and UPI based digital
payments for online and offline transactions.
India has about 800 million internet subscribers of
whom ~350 million fall into the category of online
transactors or mature users.
Indian startups have seen remarkable growth,
amassing a total valuation exceeding USD 600
billion. With 108 startups in the unicorn club, India is
now home to the 3rd largest unicorn base, trailing
only the USA and China. Impressively, 30% of these
unicorns are already profitable, while another 40%
are on the path to their profitability.
This large and diverse internet user base has led to
the emergence of an array of internet startups with
diverse business models.
Source(s): Redseer IP
India’s Internet Funnel
In Mn, FY22-24P
750-800
630-650
Internet Users
Smartphone Users
FY 23
Types of Internet users
40 – 45
Mn
300 – 325 Mn
400 – 450 Mn
Mature Users
Frequent online service users across eCommerce,
fintech, , 50%+ of wallet spent online
Transactors
Opportunistic transactors, uses UPI and buys
some product online
Explorers
Don’t transact, only consume media –
Social media, etc.
© Redseer
otal Internet users 750-800 Mn
Source(s): Redseer Research and Analysis
Mobile Data Prices and Data Usage
In USD, CY22
Number of Internet Users
In Mn, CY2022
Mobile Data Usage (in GB) per month per user
Mobile Data Pricing per GB (in USD)
Israel
Italy
India
Thailand
Turkey
Indonesia
Australia
Singapore
Brazil
United
Kingdom
Mexico
Japan
South
Korea
0.04 0.12 0.17 0 0.41 0 0.6 1 1 1.9
3.85
5.62
13
19.5
11
3
11.32
18.44
12.27
10.24
20
6
9
5
6.16
8.48
9.55
15
Global avg
Global avg
~55 Mn ~72 Mn
~205 Mn
~307 Mn
~800 Mn
~1020 Mn
Thailand
Vietnam
Indonesia
US
India
China

12. 12
Source(s): Invest India, Redseer Research and Analysis
No. of Unicorns in India
FY19-22
25
32
43
87
108
Pre-FY19 FY19 FY20 FY21 FY22 FY19 FY20 FY21 FY22
Valuation of Indian Startups
USD Bn, FY19-FY22
213
257
454
600+
We have comprehensively assessed the top 6
consumer internet sectors that have been
impacted by the development of Digital Public
Infrastructure in India. Within these sectors, we
have analysed the evolution of startups and the
corresponding business models that have taken
shape.
DPIs such as eKYC and UPI have been critical to
growth of startups in several of these sectors by
enabling customer onboarding, verification and
payments. ONDC too is gaining traction and can
enable new propositions and startups to emerge.
Source(s): Redseer Research and Analysis
Consumer Internet
Sectors DPIs Leveraged
Business Model Business Growth
DPI Impact on the Sector
Payments UPI, eKYC
UPI, eKYC
eKYC, AA, OCEN
UPI, eKYC
UPI, ONDC, Fastag
UPI
Wealth Management
Lending
Gaming
eCommerce
Subscriptions
Redseer View
UPI is the core business model of payment
apps and their growth
eKYC has driven rapid growth for wealthtech
players. UPI supports payment democratisation
eKYC and AA have enabled fintech players to do
rapid low-cost customer analysis across India
eKYC and small ticket payments enabled
through UPI have been the key growth driver
WhileUPIissupportingpayments;ONDCisexpected
to be a game changer for eCommerce in future
Small ticket subscription payments through
UPI have driven rapid growth for OTT platforms
© Redseer

13. 13
like Financial Servicese Commerce, Gaming and
Entertainment, Logistics & Mobility, and
Subscriptions.
Our analysis suggests that the DPIs have already
created over USD 100 Bn of value in the Indian
consumer internet ecosystem spanning sectors
Select set of sectors and companies impacted
Source(s): Redseer Research and Analysis
USD100+Bn
Valueunlockedby
DPIsintheconsumer
internetspace
Insurance,Banking,Education
Brokerage,WealthManagement,Banking,
Insurance,Lending
Payments,eCommerce,Gaming,Travel,
Subscriptions
Logistics,Mobility,eCommerce FinancialServices,Lending
eCommerce,Logistics,Mobility,
FinancialServices
© Redseer

14. 14
also foraying into other sectors – credit, commerce,
wealth management, insurance, etc. Additionally,
numerous other firms, spanning from startups to
established industry incumbents, are streamlining
their payment processes by introducing their own
UPI gateways.
The aggregate valuation of key players in the
payment industry, encompassing both unicorns
and publicly listed companies, exceeds USD 40
billion. This is attributable to the transformative
impact of UPI payments, with UPI serving as rails
for companies to diversify into additional services,
leveraging its extensive userbase.
Sectoral Deep dive on the Impact of DPIs
on the Consumer Internet Ecosystem
The last three years have marked a transition in
India from offline to online, cash to non-cash. By
2027, it is expected that non-cash transactions will
account for 40% in volume, and UPI will constitute
approximately 90% of it, trumping payment cards.
This next wave of growth is expected to come from
outside the top 40 cities in the country, enabling
democratization of a critical financial service.
UPI has led to the emergence and rapid scaling of
some of the largest Fintech companies in the
country. The three market leaders of the payment
industry command a substantial 96% share of the
market. Capitalizing on their extensive reach and
high engagement among merchants and
consumers, these payment - based companies are
3.0
Payments
“We have been the largest beneficiary of UPI and with KYC being mandated for
digital wallets, Adhaar-based biometric verification reduces our costs and
optimises risk”
– One of top 3 largest digital payments companies
Source(s): NCPI UPI Product Statistics, Product Ecosystem, Redseer Research and Analysis
UPI Transaction by Value and Volume
In Bn, FY17-22
The three leaders constitute 96% of the market and
are valued ~ USD 30 Bn
80
70
60
50
40
30
20
10
0
Transaction
Value(inBn)
Transaction
Volume(inBn)
1600
1400
1200
1000
800
600
400
200
0
0
4
19
39
74
11
FY17 FY18 FY19 FY20 FY21 FY22
Withalargeheadroom,still,forotherplayerstogrow the
UPIspace
48%
35%
13%
4%
Others
Value
Volume
© Redseer

15. Remarkably, 70% of retail merchants attribute an
increase in their sales directly to UPI adoption.
In the past year alone, there has been a significant
surge, more than doubling, in the volume of
peer-to-merchant transactions conducted through
UPI.
with over 10 million merchants adopting
soundboxes to facilitate more than 5 billion
transactions. To enhance UPI's accessibility and
inclusivity, the government introduced UPI Lite, a
specialized payment solution tailored for locations
with limited or no internet connectivity.
In response to the growing consumer shift towards
digital transactions, enterprises are proactively
digitizing their payment methods. Of the estimated
85 million merchants, 60% now embrace
e-payments. Currently, there are over 272 million
operational QR codes at merchant points of sale,
The key demand drivers enabling more users to transact on UPI are-
Convenience – UPI offers real-time transaction processing with a user-friendly interface, making it easy to
navigate and adopt
Interoperability – UPI's versatility enables transactions to be seamlessly conducted across various banks
and digital wallets, enhancing its accessibility
Security – A simple, yet robust two-factor authentication and encrypted transaction ensures protection of
consumer data
Merchant acceptance – Growing acceptance of digital payments among merchants has expanded the
scope and availability of UPI transactions
© Redseer 15
Source(s): NCPI Product Ecosystem Statistics, Redseer Research and Analysis
Volume of P2M3 payments
In Bn, FY22-23
Digitization Enablers
FY22
19 Bn
43 Bn
FY22
+120%
All Merchants: Includes traders,
Shopkeepers & Other Services
E-payments: Connected to internet to
use online payment services
~ 85 Mn
~ 51 Mn
(60%)
“I operate a small shop in a village and I find it difficult to track payments through
my phone as I am not tech-savvy. But the payment company setup a soundbox
that lets me know of all transactions and I just have to check my bank account
at the end of the day.”
– Corner shop owner, village in Karnataka

16. © Redseer 16
opening from 3-7 days to less than one day and
enabled users from all parts of the country to start
investing in stocks and mutual funds with greater
ease and convenience.
As a result, eKYC empowered digital-first
brokerages to swiftly expand their operations and
establish market dominance, outpacing even
well-established incumbents. The collective
valuation of the top three stockbrokers in the
nation, all of which are online brokerages that have
experienced remarkable growth over the past two
years, is estimated to exceed USD 8 billion.
The core premise of wealth management hinges
heavily on user security and consent, necessitating
a cumbersome Know-Your-Customer process in
order to protect the identity as well as ensure the
credibility of the user.
The advent of eKYC has expanded financial
investments market by making it easy for the
brokerages to onboard a wider clientele from any
part of the country. eKYC reduced a 40-page form
to an online, paperless process that can be filled by
customers in a few minutes.It has significantly
reduced the time taken for a demat account
Wealth Management
Source(s): Redseer Research and Analysis
Active clients of the top brokerages
In Mn
6.5
6.0
5.5
5.0
4.5
4.0
3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0
Introduction
of eKYC
CAGR
90%
275%
393%
107%
53%
42%
19%
FY19 FY20 FY21 FY22

17. © Redseer 17
Impressively, today about 85-90% of all fund
transfers are conducted through UPI, accounting
for approximately 50% of the total transfer value,
while over 97% of new accounts are now opened
through eKYC again highlighting the remarkable
impact DPIs have had on this sector.
In addition to leveraging eKYC and UPI, wealthtech
firms are now looking partake in the Account
Aggregator network for easy, user-approved
financial data-sharing.
The rise of new-age brokers to the top of the
pecking order reinforces the profound impact that
eKYC and UPI together have had in enabling the
democratization of financial investments across
the country. This has also led to a significant
change in the profile of the investors and traders.
These wealthtech firms have particularly appealed
to the tech-savvy younger users, enabling them to
participate in financial markets by reducing entry
barriers to the market and through better UI/UX.
Currently, over 85% of the client base of these
discount brokers falls within the age bracket of 20
to 30 years, which is a very different profile from
the middle-aged investors of the past.
payment and onboarding processes facilitated by
eKYC and UPI. Additionally, the introduction of UPI
Autopay mandates has further bolstered
Systematic Investment Plan (SIP) contributions by
standardizing monthly payments.
Over the past five years, there has been a
significant upswing in investments within the realm
of wealth management. Mutual funds have
experienced substantial growth and
democratization, propelled by the streamlined
Source(s): Redseer Research and Analysis
Transaction Split in Fund Transfers – New-age discount stockbrokers
FY23
Others
UPI
by value by volume
50+%
85-90%

18. © Redseer 18
Lending
It establishes intermediaries that collect and share
information between financial institutions based
on user consent. Remarkably, the 440 network
participants have fulfilled over 20 million consent
requests, eliminating redundancy associated with
providing the same information across services.
The Open Credit Enablement Network (OCEN) aims
to further democratize lending by serving as a
marketplace for lenders and receivers. This is
founded on the principles of fair competition and
transparency, striving to create a more accessible
and equitable lending environment.
Digitization of the financial services sector has
exerted a profound influence on the lending and
credit landscape of the nation. Initiatives such as
Aadhaar-based eKYC and the Account Aggregator
have reduced both the cost and turnaround time
for loan processing. Simultaneously, they have
broadened access across demographic and
geographic boundaries. Fintech players are
increasingly forging partnerships with NBFCs to
enhance the availability of loans in the country.
The Account Aggregator initiative plays a crucial
role in enhancing access to financial data.
Source(s): AMFI, SEBI Annual Reports
FinTech Credit Chain in India
FinTech Lenders
Lender 1 Lender 2
NBFCs
NBFC 1 NBFC 2
Borrowers
Individuals Businesses
Loan Funds
AA
e-KYC
Mutual Fund AUM
In USD Bn
SIP Contribution
Amount
Mutual Fund
AUM
20
15
10
5
0
5
13
16
500
450
400
350
300
250
200
150
100
50
0
Mutual Funds AUM
SIP Contribution
Source(s): AMFI, SEBI Annual Reports
2017 2020 2022
Requests Data
Static Data
Consent Approval

19. © Redseer 19
Credit on UPI
Notably, over 75% of the loans facilitated by digital
players originate from locations beyond Tier-1
cities. This underscores the democratization and
evolution of credit dynamics through the
digitization of financial services.
In the last four years, India has witnessed a
remarkable surge in loan origination volume,
expanding nearly sevenfold from 8 million to 63
million, with the corresponding loan values
doubling. This indicates a significant shift in the
credit market towards small-value loans,
particularly those below INR 1 lakh, which have
experienced exponential growth (refer to Figure 19).
In a strategic move to enhance Fintech adoption in
the country by capitalizing on the vast footprint of
UPI, the RBI launched an additional payment
feature through pre-sanctioned credit lines. This
new offering facilitates payments through
pre-approved credit lines, mirroring the
functionalities of existing Buy Now Pay Later
services with prior consent of the consumer. This
feature has the potential to reduce the associated
costs of financial services while fostering the
scalability of distinctive Fintech products.
Source(s): CRIF, Redseer Research and Analysis
% of Credit Origins, by volume
INR, FY18-22
Small Loan (< INR 1 L) Originations have grown from
2.8 Mn to 54 Mn!
2% 2% 2%
3%
5%
85%
3%
7%
80%
11%
31%
21%
35%
FY18 FY20 FY22 FY18 FY20 FY22
10L+ 5L-10L 2L-5L 1L-2L <1L
~18x
2-3
30-35
50-55
<1 L Origination Volumes (in Millions)
8% 6%
Operations of Pre-sanctioned Credit Lines through UPI
Source(s): Redseer Research and Analysis
Linked Bank Account
Beneficiary Bank
User’s UPI Application
Pre-sanctioned credit
limits
Payment

20. © Redseer 20
The Covid-19 pandemic has induced a cultural shift,
elevating games from casual pastimes to
established forms of entertainment and social
interaction. This shift has, in turn, driven substantial
user growth through the network effects.
Simultaneously, the development of a robust digital
payment infrastructure and increased familiarity
with digital platforms have catalysed a significant
uptick in monetization conversions in gaming. This
is exemplified by 20-25% growth in new paying
users from 2020 to 2022 as per Redseer’s analysis.
UPI and eKYC have played a pivotal role in growing
the online gaming industry to about 100 million
users and USD 27 billion in transaction value.
Real-money gaming necessitates payments and
managing small ticket transactions for 100 million
customers across the country and income strata.
Within India's credit-eligible adult population, which exceeds 800 million individuals, only about 180-200 million
individuals have access to credit services. The remaining populace is either entirely unserved or significantly
underserved. The introduction of credit on the UPI has the potential to bridge this gap by extending credit and
Buy Now Pay Later (BNPL) services to all its users, thereby nearly doubling the country's current credit
ecosystem.
This substantial growth in credit access is underpinned by the increasing credit appetite of Indians across
various income strata and city tiers, which is poised to drive the next wave of lending expansion. This trend is
substantiated by several key indicators:
An increase in BNPL contributions to digital payments by approximately 400% since 2019
UPI payments originating from Tier-2+ locations accounting for over 50% of all transactions
Over 70% of small-loan originations emanating from Tier-2+ cities
Source(s): TansUnion CIBIL, Paytm, Redseer Research and Analysis
Credit Served Population
In Mn
~2x
350-400
180-200
Credit Served UPI Users
Potential for
credit penetration
through UPI
Gaming
Source(s): Redseer Research and Analysis
Real Money Gaming Market Landscape- Number of
Gamers & Transaction Value
FY20-22
FY20 FY21 FY22
~1.7x
80-85
60-70
95-100
Considering UPI's suitability for low-value
transactions and the growing contribution of
small-ticket amounts to the overall revenue, it is not
surprising that approximately 70% of all gaming
transactions are made through UPI. Online gaming
platforms also need to verify their customers to
meet regulatory requirements which is being
enabled by eKYC.
DPIs have unlocked a value of about USD 14 Billion
through monetization and the scaling up of
startups such as Games24x7, Dream11, MPL,
Gameskraft, Zupee, Winzo, Head Digital Works, etc.

21. © Redseer 21
E-commerce in India has experienced rapid growth,
paralleled by a rising population of digitally mature
consumers engaging in online transactions across
various services. In 2022, the e-commerce sector,
spanning e-tailing, mobility, and foodtech, achieved
a Gross Merchandise Value (GMV) of approximately
USD 80 billion. Even within this digitally advanced
industry, Digital Public Infrastructures (DPIs) have
played a pivotal role in enhancing operations and
contributing to improved profit margins for the
players involved.
eCommerce
Source(s): Redseer Research and Analysis
% Contribution of Transaction Size Split to Total Revenue
FY19-22
USD 8 Bn
USD 27 Bn
10%
7%
10%
11%
72%
67%
13%
10%
< INR 500
INR 500-1000
INR 1000-2000
INR 2000+
FY19 FY22
A significant share of eCommerce transactions now happens through UPI, driven vigorously by merchants due
to zero MDR on UPI payments. The share of UPI in overall transactions is as follows-
Mobility: ~65%
Foodtech: ~50%
eTailing: ~35% (Within prepaid instruments, UPI accounts for almost 55% of the payments)
Furthermore, the introduction of GST and FasTag has improved operational and logistical efficiencies within the
sector. The most notable impact in eCommerce is its penetration into Tier-2+ locations, effectively extending
choice and access to all pincodes in the country.
Source(s): Redseer Research and Analysis
Notes(s): eCommerce includes eTailing, mobility, and foodtech
eCommerce Transactors
FY19, FY22
FY19 FY22
45%
23%
32%
29%
16%
55%
Metro Tier 1 Tier 2+

22. Redseer projects that by 2030, ONDC could
potentially generate a Gross Merchandise Value
(GMV) ranging from USD 250-300 billion, spanning
across sectors such as mobility, foodtech, e-tailing,
fintech, travel and B2B. This is expected to catalyse
the emergence of new business models within the
e-commerce landscape. While ONDC currently
constitutes less than 3% of the total consumer
internet economy, it could contribute to around
30% by 2030.
With the vision of making digital commerce
accessible open and accessible to all, merchants,
and consumers alike, ONDC holds the potential to
be a disruptor across multiple sectors. Within just
nine months of its inception, ONDC has already
onboarded more than 150,000 merchants,
attracting significant interest from prominent
digital players such as Paytm, PhonePe, and Ola,
who are all participating in this ecosystem.
© Redseer 22
ONDC Disruption
This substantial growth is poised to be driven by several key factors-
ONDC’s open architecture, which enables new product-service offerings/combinations at reduced costs
ONDC's ability to enable the monetization of customer bases for various customer platforms.
The increased participation of smaller sellers/MSMEs who stand to gain from digitization at more affordable
costs and streamlined processes, a departure from the resource-intensive requirements of the existing
eCommerce models
The democratization of access and choices for consumers across different tiers of population
ONDC GMV Projections for 2030
In USD Bn
Source(s): Redseer Estimates
Notes(s): Others can include travel, B2B, etc.
250-300
70-80
140-160
10-15
15-20
40
Mobility Foodtech eTailing Fintech Others ONDC
Projections indicate that MSMEs' contribution to
eTailing is expected to triple by 2030, driven by
ONDC and the broader democratization of the
internet facilitated by DPIs.
At present, Micro, Small, and Medium Enterprises
(MSMEs) make up approximately 10% of the overall
Gross Merchandise Value (GMV) in the eTailing
sector.

23. © Redseer 23
eTailing – Split by MSME and Others
FY 2023-30P, % of eTailing GMV
Source(s): Redseer Research and Analysis
MSMEs
MSMEs
Others
Others
30%
71%
10%
90%
FY23 FY30P
CAGR
(FY 23-27P)
MSME Contribution
Others
40-45%
15-20%
Launched in 2021, UPI Autopay has revolutionized
the collection of payments for subscription-based
services across a wide array of categories,
including OTT, insurance, financial services,
telecom, media, and more. Presently, UPI Autopay
boasts a roster of over 100 active merchants,
facilitating monthly subscriptions of up to INR
5000, a cap that caters effectively to the majority
of B2C subscription services.
With increased spending by the Indian diaspora
and the growth of eCommerce and digital
payments, subscription businesses are gaining
popularity. Customer-centric models offering
choices across plans, pricing, and features allow
personalization for consumers at all stages.
Subscriptions
Source(s): NCPI UPI Autopay Product Statistics
Cumulative UPI Autopay mandates - Quarterly
In Mn, OND’21 – AMJ’23
100+ merchants live on UPI Autopay
Mobile Application Stores
15
30
43
61
84
106
132
OND’21 JFM’22 AMJ’22 JAS’22 OND’22 JFM’23 AMJ’23
OTT
Insurance
NBFCs
Media

24. © Redseer 24
and others typically range from INR 99 to INR 299.
The accessibility of UPI and UPI Autopay has
streamlined the payment process for these
low-value services, effectively fuelling the rapid
expansion of these businesses.
In this context, OTT platforms have experienced an
explosive surge in subscribers, witnessing an
eightfold increase from 2020 to 2022. The monthly
subscription fees for major OTT platforms such as
Netflix, Disney+Hotstar, Audible, Spotify, KukuFM,
“UPI payments have seen rapid growth over the last 2 years, and now account
for a large part of our subscription payments”
- A major OTT platform
The next wave of DPI transformation is expected in Heathcare, Agritech, and Insuretech, with startups
strategically leveraging open protocols to develop new business models and achieve accelerated growth.
Healthtech: ABHA and UHI will streamline processes related to consultation, diagnosis, and clinical
decision-making while also offering financial security during medical emergencies. DigiLocker 2.0 will
facilitate the seamless linking, automatic updating and secure storage of health records and medical
insurance documents.
Agritech: The creation of a digital ecosystem for agriculture will bring changes to traditional practices,
ushering in a new era of tech-driven precision farming. The digitization of every aspect, from climate data and
seed quality monitoring to sales and marketing, will empower farmers to achieve higher yields and better
price realization.
Insuretech: Harnessing DPIs for insurance solutions will ensure market penetration and extend financial
protection across demographics and geography. eKYC, ABHI, UPI, DigiLocker, and UPI Autopay will facilitate
faster health assessments, cost savings, centralized document storage, and convenient premium payment
options.
Other Sectors
Source(s): Redseer Research and Analysis
OTT Subscribers across categories
In Mn, FY20-22
70-80
460-470
660-670
~9x
FY20 FY21 FY22
85%
15%
91%
90%
9%
10%
Video Streaming Audio Streaming

25. © Redseer 25
In conclusion
DPIs have added substantial value to the Indian Internet economy. Many companies and sectors would not
have reached the scale that they have without the enabling rails of DPI.
Going forward, the Indian internet economy is
expected to grow to USD 1 Trillion by 2030. This will
require significant expansion of merchant and
consumer base for existing verticals which will be
enabled by DPIs such as eKYC, UPI.
New services around edtech, healthtech and
agritech by their nature need to be democratised
across the country and existing and new DPIs will
be required to enable their growth.
Source(s): Redseer Estimates
Note(s): 1. eCommerce includes eTailing, foodtech, ePharma, 2. Fintech includes banking, wealthtech, payments, bill pay and recharges, BNPL, insuretech, and lending,
3. Entertainment includes gaming and media & content, 4. Mobility includes ride hailing through 2-, 3-, 4-wheelers, 5. Edtech includes K12 and post-K12 segments,
6. Others can include auto sales, proptech, etc., 7. ONDC, OCEN, ABHA, Agristack, etc. will expand the consumer internet pie within and beyond these categories
Internet GMV: India
USD Bn, FY22, FY30P
USD 180-200 Bn
USD 1000+ Bn
FY22 FY30
DPI-enabled
30%
70%
Source(s): PIB Agristack, Redseer Research and Analysis
Saved medical records lead to
faster clinical decision
Agricultural supply-chain
digitisation and support
Healthcare Agritech Insurance
ABHA & UHI AgriStack (DPI4A)
eNAM
DigiLocker 2.0
Financial security for medical
emergencies
Digital storage and auto-update
of medical records
Seamless linking of health
insurance documents
Time and cost savings during the
onboarding process
eKYC
Climate and environment
monitoring for better yield
Farmer education from seed-
to-sale
Better price realisation via
e-bidding marketplace model
Faster health assessment through
linkage with ABHA ID
ABHA & UHI
Digital storage & update of health
insurance documents
Digilocker 2.0

26. Authors
Mohit Rana Senior Partner
Mohit has over 25 years of experience in operational improvement, organizational
transformation, and new business launch across various sectors like retail,
eCommerce, telecom, construction, and technology. He is an MBA graduate from IIM
Ahmedabad and B.Tech graduate from IIT Delhi.
Siddharth Surana Sr. Engagement Manager
Siddharth is a seasoned professional with a wealth of experience in driving
innovation, fostering growth, and implementing investment strategies across
diverse markets, including India, Southeast Asia (SEA), and the United States. He is a
CFA Charterholder, MSc. from Purdue University, and B.Tech from VJTI, Mumbai.
Chinmayi Lanka Associate Consultant
Chinmayi has worked on growth strategy and research projects, along with
exposure to cost optimization and operations management across mobility and
steel sectors. She holds an MBA from XLRI Jamshedpur, and is a B.Tech graduate
from NIT Trichy.
Abdul Ayan Business Analyst
Ayan has an extensive experience assisting diverse clientele on strategic mandates
involving digitization, positioning and growth strategy, benchmarking and sentiment
profiling. He is a graduate from Shri Ram College of Commerce.
© Redseer 26

28. query@redseer.com
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