India's festive shopping season is increasingly being financed in instalments. Flipkart expects equated monthly instalment (EMI) options to account for around one-third of the gross merchandise value (GMV) of its mobiles, large appliances and electronics category this festive season, according to a senior payments executive who spoke to Business Standard. Nearly half of all high-value electronics purchases on the platform are expected to use some form of affordability option.
"Around one-third of MLE GMV comes through EMI options, with continued growth expected through the festival season," the executive said, using the company's shorthand for the mobiles, large appliances and electronics category. The comments offer a rare window into how Indian consumers are paying for big-ticket items as the Walmart-owned marketplace heads into its busiest weeks of the year.
The payment ladder
Flipkart's data suggests Indian shoppers move through a clear hierarchy of payment methods as basket sizes rise. For low-value purchases, the Unified Payments Interface (UPI) dominates. At around the ₹5,000 mark, customers begin shifting towards credit cards. Once purchases reach the ₹20,000 to ₹30,000 range and above, affordability tools such as credit card EMI become critical to conversion.
That ladder reflects the structure of Indian consumer finance. UPI has become the default for everyday transactions because it is instant, free and universally accepted. But it is a debit instrument. For a smartphone costing ₹40,000 or a refrigerator costing ₹60,000, many households prefer to spread the cost over six or twelve months, particularly when retailers and banks absorb the interest through "no-cost EMI" offers funded by brand discounts.
Flipkart offers a broad menu: credit card EMI, debit card EMI, cardless EMI, its own Flipkart EMI and its SuperPay product. The company said cardless EMI is seeing strong adoption in Tier II cities and beyond, among customers who do not hold credit cards. India has well under 120 million active credit cards for a population of more than 1.4 billion, so instalment products that rely on bank account data, credit bureau scores or the platform's own purchase history reach a much larger base than cards alone.
Biometrics beat the OTP
The second part of Flipkart's disclosure concerns how payments are authenticated. About 30 per cent of transactions on the Flipkart Axis Bank co-branded credit card now use biometric authentication, typically a fingerprint or face scan on the customer's phone, rather than a one-time password sent by SMS. Across all banks that have enabled biometric payments on the platform, the share is 23 per cent.
The benefit is measurable. Biometric-authenticated transactions show success rates 12 to 15 per cent higher than OTP-based transactions, according to Flipkart. OTP failures are a long-standing irritant in Indian e-commerce: messages arrive late, networks drop during peak hours, and users mistype codes under time pressure. During a sale, each failed payment is a lost order and often a lost customer.
The scale of the festive peak makes this especially important. Flipkart says payment requests rise roughly a thousandfold during the peak of the festival season compared with a normal business day. At that volume, a double-digit improvement in success rates translates into a meaningful difference in revenue for sellers and the platform.
Gifting and the broader demand picture
The company also reported that its gifting category has grown more than 60 per cent year-on-year, suggesting shoppers are buying for others as well as upgrading their own devices. That is consistent with a pattern seen over several festive seasons, in which smaller-town customers use online sales as their primary channel for branded goods that local stores may not stock.
The strength of instalment-led demand comes against a mixed macroeconomic backdrop. Indian equities have fallen for seven consecutive weeks, foreign portfolio investors have been net sellers, and high oil prices linked to disruption in the Strait of Hormuz have added to inflation worries. In that environment, the willingness of consumers to take on instalment debt for discretionary purchases will be watched closely by lenders and economists alike.
Risks in the fine print
The rapid spread of EMI and buy-now-pay-later products has drawn periodic scrutiny from the Reserve Bank of India, which has tightened rules on unsecured consumer lending in recent years and has pushed for clearer disclosure of the real cost of credit. "No-cost" EMI offers are typically structured so that the interest is offset by an upfront discount, but processing fees, GST on interest and penalties for missed payments can add up. For customers using cardless EMI for the first time, credit discipline matters: a missed instalment can damage a credit score that took years to build.
For lenders, the festive season is a key customer acquisition window. Banks and non-bank lenders partner with platforms to acquire borrowers at the point of sale, where intent is highest. The quality of those loans will become visible only in the months after the season, when repayment behaviour is tested.
What it means for e-commerce
Flipkart's numbers underline how closely payment design and commerce are now linked in India. The platforms that win large festive baskets are those that can offer the right mix of instalment options at checkout, approve them instantly and complete the payment on the first attempt. Biometric authentication addresses the last step. Cardless EMI addresses the reach problem in smaller towns. UPI handles the everyday transactions that keep customers returning between sales.
There is also a data dividend. Every instalment transaction gives the platform and its lending partners more information about a customer's repayment behaviour, which can be used to extend larger credit lines in future seasons. Over time, this creates a flywheel in which purchase history informs underwriting, better underwriting enables bigger baskets, and bigger baskets generate more data. It is the same model that has made commerce-linked lending one of the fastest-growing segments of Indian retail credit, and it helps explain why marketplaces are investing heavily in their own payment and credit brands rather than relying only on bank partners.
For competitors, including Amazon and newer quick-commerce players moving into electronics, the message is that financing is no longer a checkout add-on but a core part of the proposition. For regulators, the task is to ensure that easy credit at the point of sale is matched by transparent pricing and responsible underwriting. And for consumers, the lesson of this festive season is simple: the smartphone may be affordable at ₹3,000 a month, but the total cost deserves a careful read before the fingerprint is pressed.
