Unified Payments Interface (UPI) clocked over 6 billion transactions in July is the highest ever by India’s flagship digital payments platform since its inception in 2016.
UPI reported 6.28 billion transactions amounting to Rs 10.62 trillion, according to data released by the National Payments Corporation of India (NPCI), which operates the platform.
Month-on-month, the volume of transactions was up 7.16 per cent and value increased 4.76 per cent. Year-on-year (YoY), the volume of transactions nearly doubled while value of transactions was up 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 under a year, as in October 2020, UPI processed more than 2 billion transactions. In the next ten months, UPI processed 3 billion transactions. It took only three months for the payment platform to reach 4 billion transactions per month, from 3 billion.
And, the 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 fueled the acceleration of 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 increasing as the broader economy recovers.
In FY22, UPI processed more than 46 billion transactions amounting to over Rs 84.17 trillion, thus breaching the $1 trillion mark.
And, in FY21, it had processed 22.28 billion transactions, amounting to Rs 41.03 trillion. So, both volume and value of transactions doubled in a year’s time, indicating 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 Reserve Bank of India’s (RBI) digital payments index (DPI) 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 digitisation of payments across the country.
In March 2019 the index stood at 153.47 and by September 2019, it rose to 173.49, followed by 207.94 in March 2020, 217.74 in September 2020, and 270.59 in March 2021.
UPI’s target is to process a billion transactions a day in the next five years.
The RBI’s decision to allow linking of Rupay credit cards to UPI is expected to provide a huge boost to the volume as well as value of transactions in the coming months.
“We are looking at how we can expand the market. The objective is how we can go back to the 250 million users and how the bank can start doing smaller credits.
Also, we are looking at how the 50 million merchants can start accepting credit.
We may have to take care of the smaller merchants and protect them from the MDR (merchant discount rate). The existing credit card servicing merchants can continue to pay,” said Dilip Asbe, the chief executive officer or NPCI, at an event on Rupay credit card and UPI linkage.