Unified Payments Interface (UPI) made over 6 billion transactions in July: the highest ever by India’s leading digital payments platform since its inception in 2016.
According to data released by the National Payments Corporation of India (NPCI), which operates the platform, UPI reported 6.28 billion transactions amounting to Rs 10.62 lakh crore. Month-on-month, transaction volume increased by 7.16 percent and value by 4.76 percent. Year-on-year (YoY), transaction volume nearly doubled, while transaction value grew by 75 per cent.
UPI crossed 1 billion transactions for the first time in October 2019, almost three years after its launch. The next billion came in less than a year, as in October 2020, UPI processed over 2 billion transactions. In the next ten months, UPI processed 3 billion transactions. It took only three months for the payments platform to reach 4 billion transactions per month from 3 billion. And, incremental one billion transactions were achieved in just six months’ time. The next incremental one billion was achieved within six months.
The COVID-19 pandemic has accelerated the adoption of digital payments in the country in the last two years. Apart from a few hiccups during the first two waves of the pandemic, UPI transactions are on the rise as the broader economy recovers.
In FY22, UPI processed over 46 billion transactions amounting to over Rs 84.17 trillion, thus crossing the $1 trillion mark. And, in FY 2011, it had processed 22.28 billion transactions, amounting to Rs 41.03 trillion. Hence, both the transaction volume and value doubled in a year’s time, reflecting the meteoric rise seen in the adoption of digital payments, especially UPI, in the country.
Reflecting the rapid adoption of digital payments in the country, the Digital Payments Index (DPI) of the Reserve Bank of India (RBI) rose to 349.30 as of March 2022 as against 304.06 in September 2021. Launched in January 2021, the DPI index indicates the extent of digitization of payments across the country. The index stood at 153.47 in March 2019 and increased to 173.49 by September 2019, followed by 207.94 in March 2020, 217.74 in September 2020 and 270.59 in March 2021.
UPI aims to process one billion transactions a day in the next five years. RBI’s decision to allow RuPay credit cards to be linked with UPI is expected to drive a massive increase in transaction volume and value in the coming months.
“We are looking at how we can expand the market. The aim is how can we go back to 250 million users and how can banks start doing small credits. Plus, we’re also looking at how 50 million merchants can start accepting credit. We have to take care of small traders and protect them from MDR (merchant discount rate). Existing credit card servicing merchants can continue to make payments,” said Dilip Asbe, chief executive officer or NPCI, at an event on RuPay credit card and UPI linkage.