In a year bogged down by pandemic-driven lockdowns and social distancing, online transactions grew by 80 percent in India as compared to 2019, suggesting a significant adoption of digital payments by consumers and businesses alike especially from the smaller cities.

The tier II and III cities were a major driver for online transactions inlets year and witnessed 92 percent growth. Consumers moved to online to make most of their payments, making the bill payments/ utilities sector witness a sizable growth of 357 percent.

The UPI transactions outgrew cards, netbanking and wallets with 120 percent growth in a year, becoming the most preferred mode of payment especially for Tier- II and III cities.

"While the overall transactions in 2020 significantly grew compared to the last year, what I'm really excited about is that it grew by about 73 percent in the last six months alone," said Harshil Mathur, CEO and Co-Founder, Razorpay.

"So much so that the transactions from tier II and III cities grew by about 92 percent in a year. This is the first time that we've seen such a spectacular growth from these parts of the country," Mathur added.

Mutual funds grew by 382 percent in a year, indicating a ripe time for investments as consumers viewed the market corrections as an opportunity rather than a threat, according to the report by fintech unicorn Razorpay.

"With every service moving to virtual platforms, the education, e-commerce and healthcare sectors also witnessed a significant growth of 167 percent, 189 percent and 148 percent, respectively. The logistics sector also showed a slight growth of 18 percent in 2020. Businesses are beginning to stabilise and some of them are even back to pre-COVID levels," Mathur said.