Digital payment system Unified Payments Interface or UPI has crossed 1 billion transactions in volume in the first 15 days of October, shows RBI’s settlement data of select payment systems. The NCPI-owned digital payments platform is likely to post more than 2 billion transactions in the month, a feat that it has never reached since its inception in 2016.
This will be a 2X year-on-year growth for UPI which had crossed the landmark of 1 billion in volume in a month for the first time in October, last year. It’s worth noting that UPI has recorded a billion transactions in 15 days for the first time.
According to the RBI data, UPI has registered 1,013 million or 1 billion transactions amounting to Rs 191,986.9 crore or Rs 1.91 trillion between October 1 to 15. Last month, it had clocked its highest ever volume of transactions at 1.8 billion worth Rs 3.29 trillion.
April was the only month in which UPI transaction volume had slipped below 1 billion in the past year (October 2019 to September 2020). UPI bounced back in May and has been growing on both fronts of volume and value.
The ongoing festive season and discounts offered by several e-commerce players including Flipkart and Amazon could further trigger the number of transactions in the latter half of this month.
Industry experts tracking the space assert that UPI may cross 2 billion transactions since a sizable chunk of shoppers will be using the payment interface for e-commerce purchase. Google Pay, PhonePe, Amazon Pay and Paytm are also offering discounts on Amazon and Flipkart for their festive sales.
“It is heartening, and not surprising to see UPI leapfrogging to cross 1 billion transactions in the first two weeks of this month. Additionally, in the midst of the upcoming festive season, which are usually a ripe season for e-commerce giants to push sales, UPI transactions are sure to be further bolstered. With recent regulatory policies pushing for offline payments to help digital payments permeation in rural areas, UPI will set a national open standard for the Indian banking ecosystem,” said Mandar Agashe, Founder, MD & Vice Chairman, Sarvatra Technologies.
Ever since the spread of Covid-19 pandemic, consumers have been shifting towards contactless mode of payments and UPI has become one of the most favoured modes. The fear of contracting a virus with physical currency has also helped UPI-enabled apps grow in the past six months.
According to recent data sourced from Sensor Tower, Google Pay was the most downloaded fintech app across the world in September. From India, PhonePe, Paytm and SBI YONO also made it to the top 10 list with 4th, 6th and 10th rank respectively.
Google Pay was downloaded more than 12 million times in the last month of which over 80% installs came from India. PhonePe, Paytm and SBI YONO’s downloads were recorded at 6.9 million, 3.9 million and 3.1 million respectively.
“Rural consumption has seen greater recovery as compared to urban regions, and with the advent of smartphones and mobile-based payments, there is likely to be an even greater spurt in the upcoming month. Agent banking or Assisted banking, which is popular in semi-rural and rural areas is likely to help boost digital payments through small ticket purchases. E-commerce has been one of the greatest drivers of digital banking, and retail platforms are leaving no stone unturned to incentivise the rural segment to consume more with attractive offers and discounts,” said Anand Kumar Bajaj, MD & CEO, PayNearby.
A separate report by RBI also revealed that digital or contactless payments have grown 135.4% from 14,590 million in FY18 to 34,345 million in FY20. The transaction includes RTGS, UPI, NEFT, AePS, and IMPS. Among them, UPI had recorded the highest volume in FY20 at 12,518.6 million or 12.5 billion.