A recent study by Empower India highlights the increasing importance of rewards and cashback in influencing how Indian consumers choose their Unified Payments Interface (UPI) applications. The survey found that a substantial 89% of UPI users consider these incentives before selecting a payment platform, indicating a significant shift in user behavior.
Rewards Drive UPI App Selection
The research underscores that rewards are no longer just a marketing add-on but a crucial component of the digital payments experience. A staggering 94% of users view rewards as an important factor when considering switching platforms, and 88% actively compare UPI apps to find better reward offerings.
Consumer loyalty is now increasingly tied to these incentives, with 83% of respondents expressing a willingness to switch payment apps if another platform provides more attractive rewards. Among users who had already made a switch, 59% cited poor rewards and benefits as the primary reason for leaving their previous app. Other factors influencing switches included ease of use (64%), trust and customer support (61%), and payment convenience (28%).
Amazon Pay Leads in User Satisfaction
In a competitive landscape, Amazon Pay emerged as the highest-rated platform for customer satisfaction regarding rewards. The study revealed that 74% of Amazon Pay users reported being “very satisfied” with the rewards they receive. Furthermore, 87% of Amazon Pay users stated they chose the platform due to the everyday value delivered through its rewards and cashback programs, compared to 73% for Google Pay.
Cashback on routine transactions proved to be a key differentiator for Amazon Pay, with half of its users citing this as a main reason for their choice. In contrast, 38% of PhonePe users and 35% of Google Pay users highlighted this benefit.
While Amazon Pay excelled in satisfaction, Google Pay marginally led in reward redemption satisfaction at 70%, with PhonePe and Amazon Pay tied at 68%, indicating that redemption convenience is also a competitive battleground.
Beyond Basic Payments: The Shift in Competition
K. Giri, Director General of Empower India, commented on the findings:
“India has successfully built one of the world's most sophisticated real-time payment infrastructures, but the next phase of growth will depend more on customer engagement than on user acquisition. Our research shows consumers increasingly expect tangible value from every transaction, making rewards an integral part of the digital payments experience rather than a marketing add-on.”
The study found that while Amazon Pay led on rewards satisfaction, PhonePe and Google Pay scored strongly on trust and security, and Paytm received high ratings for ease of use. As India's UPI ecosystem matures, speed, reliability, security, and merchant acceptance have become baseline expectations rather than unique selling points. The report suggests that payment platforms will increasingly compete on rewards, cashback, and overall user experience. With low switching costs, long-term customer loyalty in digital payments will hinge on consistently delivering meaningful value beyond just seamless transactions.