Flipkart, Axis Bank, PayU shift card payments beyond OTPs with biometric authentication

Rollout begins with Axis Bank cardholders as RBI pushes biometric and risk-based authentication.

Flipkart has partnered with Axis Bank and PayU to introduce biometric authentication for card payments, marking a shift away from OTP-based transaction verification in India’s digital commerce ecosystem.

The feature allows users to authenticate transactions using fingerprint or Face ID on supported Android and iOS devices, eliminating the need for SMS-based one-time passwords.

The rollout is currently available for Axis Bank cardholders and is enabled through issuer-level biometric verification.

With this, Flipkart becomes one of the early large e-commerce platforms in India to integrate biometric authentication into card payment flows.

The move comes as the industry looks to reduce friction in digital payments while addressing rising concerns around fraud linked to OTP-based systems. The move reflects the shift towards device-bound authentication, where verification is tied to the user’s smartphone and biometric credentials rather than SMS-based OTPs.

This approach reduces vulnerabilities such as SIM-swap fraud and OTP interception, which have become more prevalent as digital payments scale.

The system combines biometric authentication with device fingerprinting and additional security checks to ensure transaction integrity. For users, this removes the dependency on mobile network availability and reduces delays associated with OTP delivery, enabling faster checkout experiences.

From an operational standpoint, it is also expected to improve transaction success rates by reducing authentication failures.

PayU manages infrastructure, Axis Bank handles issuer verification

Under the partnership, PayU is responsible for managing the merchant-side infrastructure, including device security and authentication flows.

Axis Bank handles issuer-side biometric verification using its payments security platform, Wibmo, a PayU company.

This split architecture allows authentication to be validated at both the merchant and issuer levels.

The integration brings together e-commerce, banking, and fintech layers to create a more seamless authentication framework.

The launch comes against the backdrop of increasing digital payment fraud in India. Fraud values have surged over fivefold to exceed ₹1,400 crore in FY24, according to RBI-linked data.

In response, the Reserve Bank of India has been pushing for stronger authentication mechanisms. Its ‘Authentication Mechanisms for Digital Payment Transactions Directions, 2025’ encourages the adoption of biometric and risk-based authentication over traditional OTP systems.

This collaboration aligns with this regulatory direction, offering a model that balances security with user convenience. By moving authentication to biometric credentials, the system reduces reliance on SMS infrastructure while maintaining compliance with regulatory requirements.

Beyond security, the initiative aims to simplify the payment experience. Biometric authentication is already widely used for device unlocking and app access, making it a familiar and intuitive method for users.

By extending this to card payments, the companies are reducing friction in the checkout process. This is particularly relevant as digital commerce platforms look to optimise conversion rates and reduce cart abandonment linked to payment delays.

At the same time, the use of device-level authentication ensures that security is embedded directly into the transaction process rather than layered on as an additional step.

Signals shift in payment authentication models

The rollout signals a structural shift in how digital payments may be authenticated in India going forward.

While OTP-based systems have been the default for years, they are increasingly seen as both a friction point and a security vulnerability.

Biometric authentication, combined with device intelligence and risk-based checks, is emerging as a more scalable alternative.

PayU Payments’ chief business officer, Hemang Dattani, said, “As digital commerce continues to scale in India, simplifying payments without compromising on security is critical. At PayU, we are proud to partner with Flipkart to enable a biometric authentication experience for card payments, helping customers move past long-standing friction associated with OTP-based verification.”

“By combining biometric authentication with enhanced security controls, this partnership marks a meaningful step towards building a faster, more secure and frictionless digital payments experience for Indian consumers,” Dattani added.

The collaboration highlights the growing convergence between fintech platforms, banks, and digital commerce players in building next-generation payment infrastructure.

As adoption expands beyond the initial rollout, similar models could be extended to other issuers and platforms. This could accelerate the transition towards biometric-first authentication frameworks across India’s digital payments ecosystem.

For now, the Flipkart, Axis Bank, and PayU partnership provides an early implementation of this shift, combining regulatory alignment, improved security, and a streamlined user experience into a single payment flow.