India's consumer spending to exceed the US's over three times by 2034

As per the information provided in the World Data Lab analysed by EBANX, India is set to exceed the mark of USD 5.4 trillion in consumer spending by 2034, up from the current USD 1.8 trillion. This results in a growth of 12% per year, three times higher than the forecast for the US, at 4%, and over two times higher than the global average of 5%.

This increase solidifies India’s position in the market, making it the third-largest economy in the world in consumer spending, behind the US and China. When commenting on the news, representatives from EBANX underlined that, recently, India achieved record levels of financial inclusion, with the region actively promoting the adoption and growth of the online sector. In addition, it is mentioned that the projection for consumer spending is set to be felt in digital commerce as well, in all verticals.

Besides India, EBANX underlined two other regions that have seen significant acceleration, including Latin America and Africa, whose countries are among the fastest growing globally. At the same time, Egypt is anticipated to accelerate its growth by triple-digits in consumer spending by 2034, 167%, while Ethiopia, which is among the smaller economies, is expected to expand by 429%. When it comes to the Latin American region, Brazil (62%) and Mexico (54%) are at the forefront of growth, with each region surpassing USD 2 trillion in consumer spending over the upcoming decade. EBANX linked this expansion to the digitalisation of the economy and the payment advancements present in these markets.

Considering the low penetration of credit cards, barriers related to banking access, and consumer behaviour, fintech firms and governments started to seek solutions to augment consumers’ lives and enable them to acquire products and services leveraging local payment methods. This resulted in an improvement in how individuals engage with digital commerce in emerging markets. For example, India’s UPI is currently the preferred method for online purchases, accounting for 55%. Similarly, Latin America’s Pix follows the same path and is set to exceed credit cards in digital commerce by 2025, with the local Central Bank intending to introduce Pix Automático for recurring payments.

Despite African countries being promising for growth, representatives still mention difficulties that need to be addressed, including high market fragmentation and a lack of interoperability. Industry experts underlined the positive impact that strategic partnerships could have in connecting Africa with the rest of the world.