India has overtaken the US in terms of the number of users engaged in online transactions, including e-commerce. According to a report by the Internet and Mobile Association of India (IAMAI), around 346 million Indians are engaged in online transactions such as e-commerce and digital payments, a number which is greater than the total US population estimated at 331 million.

“The global pandemic witnessed a record 51 per cent increase in digital transactions in just two years, from 230 million in 2019 in India. In terms of gender break-up, there are more male Internet users in India than female users, with almost similar gender ratios across both urban and rural users,” the IAMAI KANTAR report titled ‘Internet in India’ said.

In terms of use cases, entertainment, communications and social media are the top three activities engaged in by Internet users across India. While communications using text and e-mail is the most popular usage, the survey suggests that voice and Indic languages usage will be the key drivers of growth in the future, with two out of five rural Internet users having done voice-based activities on their phones.

The penetration of OTT services in rural India is at par with that in urban India. However, the penetration of other digital services such as online gaming, digital commerce and digital payments is still skewed in favour of urban users. This reflects large head-room for growth of such services among the rural population.

According to the report, there are 692 million active Internet users in India, and much of the growth continues to be driven by rural India (351 million users with 37 per cent penetration), as urban India seems to have hit a plateau (341 million users with 69 per cent penetration). The report also estimates that there will be 900 million Internet users in India by 2025m led by rural growth. Among the states, Goa has the maximum internet penetration, while Bihar has the lowest.