Coimbatore, Hyderabad and Chennai Lead on Electronics and

                          Appliance Financing, with 70% Using BNPL or EMI

75% of urban Indians have used at least one financial product through their primary payment app

51.5% would borrow through the app if a guarantee against unauthorised transactions were provided

77% spend at least 50% more during the festive season; Fashion & Beauty (89%) tops on volume, Consumer Electron

ics on value

Gig workers: 23% turn first to a digital loan app in a cash crunch, 3.4X the national rate

• Tier-3 merchants lead digital-payments enthusiasm — 4 in 5 report efficiency gains

Hyderabad, 22 October 2026: Pahlé India Foundation today released the How Urban India Pays Report 2026 in collaboration with Amazon Pay. Based on a survey of 5,149 consumers and 1,054 merchants across 100 cities in 20 states, the report finds that digital payments have become an everyday habit, with UPI leading in five of six spending categories. Three in four (75%) urban Indians have used at least one financial product within their payment app — yet this confidence has not extended equally to digital credit, where awareness is high (88%) but usage remains low (31%).

To quantify this divide, the report introduces the Digital Credit Inclusion Index (DCII) 2026 – India’s first composite benchmark providing a comprehensive view of the country’s digital credit journey. The index gives India an overall score of 55.85 out of 100, placing it in the “Emerging & Served” category (51-75). The DCII measures three core pillars – Access (61.24), Adoption (57.17) and Impact (49.16), highlighting that while digital credit is within reach for most urban Indians, its broader financial impact remains limited.

At the consumer level, the impact shortfall is rooted in trust: users rate their payment apps highly for security (4.11/5) and for payments (3.98/5), but confidence drops to 3.10 when the same app offers credit. The gap looks solvable: 51.5% say they would borrow through their app if fraud protection were guaranteed, versus just 16.7% who would still decline.

“India’s digital payments revolution is one of the more remarkable achievements of our development journey. In less than a decade, UPI has moved from novelty to reflex, and urban India now pays digitally as a matter of habit. Having built this foundation of trust-based efficiency at scale, India is now ready for its next leap: extending the confidence earned in payments to borrowing, saving and investing. With transparent disclosure, robust cybersecurity and safety, and underwriting that recognises informal incomes, digital finance can reach every Indian and make a meaningful contribution to the goal of Viksit Bharat @ 2047,” said Dr Rajiv Kumar, Chairman, Pahlé India Foundation.

Vikas Bansal, CEO, Amazon Pay India, said, “What stands out this year is how confidently urban India is adopting digital credit to manage everyday finances. Consumers are increasingly turning to BNPL and EMI options not just for big-ticket purchases, but as practical tools to spread costs, stay within budget and make aspirational purchases more accessible. At Amazon Pay, we see this shift first-hand, with 75% of our customers in Tier-2 and Tier-3 cities. Our focus is on making credit simple, transparent and relevant so that every customer can plan better, spend smarter and fulfill their aspirations with confidence.”