Payment transactions through Unified Payments Interface (UPI) have witnessed decline for the last two months. After hitting a record high to 799 million transactions in March, UPI witnessed 781 million and 733 million transactions in April and May respectively.
The recent downfall has worried the National Payments Corporation of India (NPCI), which developed an instant real-time payment system three years ago.
NPCI, to drive its growth, is planning to bring non-adapting online users on UPI platform by creating an escrow-like mechanism with e-tailers and marketplaces.
It is reportedly working with Amazon and Flipkart. Under the mechanism, e-tailers will receive payment only after delivery is confirmed by the buyers. The payment at first will be kept in the escrow-like account by UPI. Once the delivery is confirmed it will be credited in e-tailers accounts.
NPCI is planning to launch this mechanism within one and a half months, as per a TOI report.
However, despite a slowdown in volume, the UPI value of transactions has not been affected. In April, as per NPCI data transactions worth Rs 1.53 lakh crore were made, up 7.3% from April.
The move is largely aimed at roping in new online buyers.
As per industry observers, NPCI-move will help drive more adoption of UPI payment. Besides, NPCI is also planning to push for retail investment in IPOs via UPI
At present, about 143 banks are live on UPI.
Among non-banking players like Google Pay, Paytm and PhonePe are top three firms, who have continuously been witnessing reshuffle in terms of the transaction volume as well as value.
Though, in the last three months, the Google-owned payment firm outran its rivals
As per latest figure, Google-owned payments app Google Pay emerged as the largest contributor of NPCI-owned UPI payment, recording 240 million transactions amounting to Rs 55,000 crore in May whereas PhonePe and Paytm registered 230 and 200 million transactions worth Rs 44,000 crore and Rs 38,200 crore respectively.
Google Pay contributed over 32% in overall 733 million UPI transactions that took place last month.