Digitalisation surge: Internet usage hits 48 percent in informal sector
Digital adoption in India’s informal sector records a 14-point jump in a major tech pivot in 2025
By Samreen Wani
Last Updated: Mar 26, 2026, 17:43 IST1 min
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In a Nutshell
- Internet usage in informal sector rose to 48 percent in late 2025
- Digital adoption rose 14 points in unincorporated firms in 2025
- Festive season likely spurred digital use and transactions
India’s unincorporated business sector is going digital at a rapid pace, with nearly half of all such establishments now using the internet, latest government data shows.
According to data from the Ministry of Statistics and Programme Implementation (MOSPI), the share of unincorporated sector establishments using the internet rose to 48 percent in the October-December 2025 quarter, up sharply from 39 percent in the previous quarter. The 9 percentage point jump in a single quarter is the steepest in the year so far and is significant for a sector that has historically lagged in technology adoption.
The digital leap
The trend has been consistently upward through 2025. Internet usage among these establishments stood at 34 percent in January-March 2025, which climbed to 36 percent in April-June, and then to 39 percent in July-September before the sharp acceleration in the final quarter. Over the course of the year, the share has grown by 14 percentage points, a notable shift for a sector comprising millions of small, owner-operated businesses which are neither registered under the Companies Act, 1956 nor under Companies Act, 2013.
The unincorporated sector includes a vast range of enterprises—from street vendors and small traders to tiny manufacturing units and neighbourhood service providers. These businesses have traditionally operated outside the formal digital economy, making the pace of adoption significant both for productivity and for the broader push toward financial inclusion. The October-December surge could partly reflect seasonal factors, as the festive period typically sees a spike in business activity and digital transactions.
Such continued digital adoption can make formal credit more easily accessible to informal businesses, streamline payments and increase their customers. This shift reflects the trends in India’s formal economy.
First Published: Mar 26, 2026, 17:43
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