The report reveals how AI, quick commerce, and rural digital adoption are reshaping India’s $125B retail economy
India’s digital commerce landscape is undergoing a seismic transformation, driven by deep rural internet penetration, explosive growth in Direct-to-Consumer (D2C) brands, and the rapid adoption of Artificial Intelligence (AI) in the retail sector. According to the Made for Bharat, Powered by AI: The New Age of Commerce Report by Shiprocket and KPMG, with 886 million active internet users 55% from rural India and UPI accounting for 84% of all retail digital payments, Bharat is not just catching up; it’s driving the change. The report was launched today at Shiprocket’s flagship commerce summit – Shiprocket SHIVIR 2025.
The D2C market is projected to hit $100 billion in 2025, with India ranking second globally in D2C funding. Quick commerce has evolved from an urban convenience to a nationwide habit, with a 40% surge in monthly transacting users and over 50% placing five or more orders each month. This shift from planned purchases to impulse buying is reshaping inventory, logistics, and marketing strategies. AI is no longer a futuristic concept—it’s the catalyst that is driving the transformation of the retail sector. From 99.9% order accuracy in warehouses to 90%+ demand forecast precision, AI is powering everything from logistics to customer engagement. Generative AI tools are enabling brands to create hyper-personalised campaigns at scale, while vernacular search is unlocking access for India’s multilingual internet base, where 98% of users consume content in regional languages.
At Shiprocket, we believe the future of commerce will be built on inclusivity, data, and agility where every seller, regardless of size or location, can thrive in an AI-native, hyperlocal ecosystem.”
-Saahil Goel, MD & CEO at Shiprocket
“India’s commerce landscape is undergoing a paradigm shift, and we are witnessing not just digital growth but also a behavioural and infrastructural revolution. From kirana stores embracing AI to rural consumers driving quick commerce adoption, Bharat is now at the heart of innovation. 2025 is Year Zero of AI-native commerce where intelligence is not an enhancement but the default engine of business. The Shiprocket-KPMG report highlights how intelligence, speed, and personalisation are becoming the new pillars of retail. At Shiprocket, we believe the future of commerce will be built on inclusivity, data, and agility where every seller, regardless of size or location, can thrive in an AI-native, hyperlocal ecosystem,” said Saahil Goel, MD & CEO of Shiprocket.
“India’s digital commerce ecosystem is entering a critical phase where intelligence, speed, and inclusivity are redefining how businesses operate and grow. The report reflects this shift, highlighting how AI is no longer a future ambition but a present-day enabler, especially for MSMEs and D2C brands. As we move into the ‘AI-native era,’ it’s critical to build infrastructure, tools, and partnerships that empower small businesses to compete and thrive,” said Manuj Ohri, Partner – Business Consulting, KPMG in India.
In line with the report’s emphasis on AI-led transformation, Shiprocket has also unveiled Shunya.ai, India’s first sovereign, multimodal AI engine built specifically for MSMEs and D2C brands. Developed in partnership with Ultrasafe Inc., Shunya.ai is trained on Indian commerce data, supports 9+ regional languages, and is hosted entirely within India using L&T’s GPU infrastructure, ensuring full data sovereignty. Shunya.ai is directly integrated into Shiprocket’s seller panel, and it offers intelligent automation across cataloguing, marketing, and fulfilment, with early pilots showing up to 40% time savings. As Bharat’s digital economy scales, Shunya.ai represents a strategic leap in making AI accessible, affordable, and locally relevant for the sellers.
As we move into the ‘AI-native era,’ it’s critical to build infrastructure, tools, and partnerships that empower small businesses to compete and thrive.”
– Manuj Ohri, Partner – Business Consulting, KPMG in India
Key Insights from the Shiprocket–KPMG Report:
AI is revolutionising Commerce: The global AI retail market reached $11.61 billion in 2024, with India leading enterprise deployment. Key AI applications transforming Indian commerce include:
- Demand Forecasting: Companies achieving over 90% forecast accuracy, reducing stockouts by 40% and excess inventory by 25%
- Warehouse Automation: Leading retailers reporting up to 99.9% order accuracy with robotic systems while cutting operational costs by 20%
- Personalised Marketing: 96% of marketers report improved sales through AI-driven personalization, with 44% seeing a significant uplift
- Vernacular Commerce: 98% of India’s internet users accessing content in Indian languages, powered by AI-enabled translation and search
Quick Commerce Redefines Consumer Expectations: Quick commerce has grown from an urban experiment to a national habit, with the sector projected to grow 75-85% in 2025, reaching $5 billion in gross merchandise value.
- 53% of users place more than five orders per month on quick commerce platforms
- 67% maintain average order values above ₹400
- 6-8% of sales now come from completely unplanned, impulse purchases
- Daily online shopping habits jumped from 33% to 87% of consumers
Rural Digital Revolution Drives Growth: The research highlights India’s unique digital transformation, with rural areas emerging as the primary growth engine.
- Rural internet users grew to 488 million in 2024, representing 55% of India’s total internet base
- Women now comprise 47% of all internet users, indicating improved gender parity in digital access
- Traditional kirana stores are integrating with digital platforms, creating a “phygital” retail model
Digital Payments Ecosystem Matures: India’s payment infrastructure has evolved into one of the world’s most sophisticated systems.
- UPI accounts for 84% of India’s total retail digital payment volume
- UPI transactions grew 59.2% year-over-year to 11,761 crore transactions in FY2024-25
- UPI Transaction values increased 44.8% to ₹180.24 lakh crore
- India now handles nearly half of all global real-time transactions
Despite this digital surge, 105 million Indians still prefer Cash-on-Delivery, highlighting the importance of hybrid payment strategies.
Enterprise AI Adoption Accelerates: Indian enterprises are leading global AI adoption across multiple functions:
- 59% of Indian enterprises with over 1,000 employees have deployed AI, the highest globally
- 70% of companies dedicate more than 5% of their IT budget to AI initiatives
- 77% of Indian startups are investing in AI, machine learning, and blockchain technologies
- AI talent concentration in India grew 263% between 2016-2023
The Path Forward: Three Pillars of Intelligent Commerce: The research identifies three foundational pillars driving India’s commerce evolution:
- Omnichannel Integration: 77% of Indian shoppers use both online and offline channels, demanding seamless experiences across touchpoints
- Personalized Experiences: 81% of consumers prefer brands offering personalized experiences, with 73% expecting even more advanced customization
- AI-Led Operations: From inventory management to customer support, AI is becoming the backbone of modern commerce operations
Market Projections and Future Outlook: The research projects continued explosive growth across key sectors
- D2C Market: Expected to reach $100 billion by 2025, with over 11,000 brands currently operating
- Quick Commerce: Projected 75-85% growth in 2025, reaching $5 billion GMV
- E-Retail: Market size estimated at $125 billion in 2025, with 220 million online shoppers
- Warehouse Automation: Market set to hit $2 billion annually by 2026
Methodology: This analysis is based on comprehensive research conducted by Shiprocket in collaboration with KPMG India, examining data from multiple industry sources, including IAMAI, RBI, Bain & Company, and leading technology platforms. The research covers market trends, consumer behavior, and enterprise adoption patterns across India’s diverse geographic and demographic segments.
Shiprocket Limited, India’s leading eCommerce enablement platform on a mission to empower the businesses of Bharat to scale their ventures by unleashing the true power of eCommerce. The platform supports sellers at every step of their digital growth journey, creating a seamless operating system. With a robust stack of technology integrations, Shiprocket enables shipping, fulfilment, customer communication, marketing tools, and commerce infrastructure for MSMEs, D2C brands, and social commerce retailers across India.
