Goodbye OTPs: How Passwordless Payments Are Taking Over In India

SOURCE : NEW18 NEWS

Last Updated:April 20, 2025, 09:44 IST

Indian users are adopting passwordless authentication for digital payments, using biometrics like touchId and faceId.

Convenience of digital payments without password is now trending with Indian users. Gearing up for a secure future in a smoother, faster and safer avatar, here’s why everyone’s embracing ‘Passwordless’ authentication..

Goodbye OTP: Crushing Traditional Authentication Hurdles

For many, the most frustrating aspect of online shopping is the need to remember passwords and enter OTPs (One-Time Passwords) during the checkout process. While these were meant to bring in security measures, today, they are not only vulnerable and can be stolen by bad actors but also often slow down the payment experience. Recognising this challenge, the shift towards passwordless authentication addresses these pain points by eliminating the reliance on traditional passwords and OTPs.

What is Passwordless Authentication?

Passwordless authentication enables users to authenticate transactions and log in to their accounts without the need for passwords or OTPs. Instead, biometric methods such as using the touchId or faceId  or using liveliness factors for facial recognition are used to verify the user’s identity. With these advancements, users no longer have to worry about passwords being stolen, guessed, or compromised. This provides a more secure and efficient way to manage online accounts and payments.

Real-World Use Cases

Consider a typical scenario where a consumer orders food through platforms like Swiggy or Zomato. Once the order is finalised, the user authenticates the payment simply by scanning their fingerprint or using facial recognition, removing the need to recall passwords or enter an OTP. Similarly, when shopping on platforms like Amazon or Flipkart, users can complete their purchases quickly and securely through biometric authentication, enhancing the overall shopping experience.

This frictionless process not only saves time but also eliminates common security risks associated with password-based systems. The convenience and speed of these transactions are quickly becoming a preferred choice for many consumers across India.

The Rise of Passwordless Authentication: A Seamless and Secure Future for Digital Payments in India

In recent times, the adoption of passwordless authentication has gained significant traction among Indian users, transforming the landscape of digital transactions. Indian regulators like Reserve Bank of India (RBI) and others have recognised the need to provide a safer and more secure environment for consumers especially while making payments.

They have rolled out guidelines asking various financial institutions to consider authentication factors beyond SMS-based OTP. This emerging trend is reshaping how individuals approach online payments by offering a faster, and more convenient experience but also making it more secure. Here’s a closer look at how passwordless authentication is poised to revolutionise the way we conduct digital transactions.

Trend Forecast: Year 2025 and ahead

As we look ahead to Year 2025, the widespread adoption of passwordless authentication in India appears inevitable. There are several key reasons driving this trend:

1. Enhanced Security

As cyber threats and data breaches continue to rise, passwordless authentication presents a more secure alternative to traditional password-based systems. Biometric factors, such as fingerprints and facial recognition, are much harder to hack or replicate than conventional passwords, providing an additional layer of security for online transactions.

2. Improved User Experience (UX)

India’s mobile-first generation is increasingly seeking faster, more convenient ways to access digital services. Passwordless authentication eliminates the need to remember complex passwords or wait for OTPs, resulting in a smoother, more efficient user experience.

3. Digital India Technological Advancements

The Indian government’s Digital India initiative is playing a crucial role in encouraging the adoption of advanced technologies. By promoting digital transformation, the government is helping drive the shift toward passwordless authentication.

Additionally, the rise of Artificial Intelligence (AI) and Machine Learning is making biometric authentication more reliable and user-friendly, further accelerating its adoption in India’s digital ecosystem.

The future is secure with Passwordless 

Passwordless authentication is poised to become the standard for digital transactions, offering a more secure, convenient, and user-friendly alternative to traditional password and OTP systems. As the trend continues to grow, it promises to significantly enhance the way we engage with digital services in India.

It is authored by Siddharth Gandhi, COO-Asia Pacific, 1Kosmos