Unified Payment Interface, in short UPI, has recorded over 6 billion transactions in July which is an all-time high for India’s flagship digital payment platform since its establishment in 2016.
According to data released by the National Payments Corporation of India (NPCI), which operates the UPI platform revealed that the platform recorded 6.28 billion transactions equal to Rs 10.62 trillion. Further, Month-on-Month, the volume of the transaction increased by 7.16 percent, and the value increased by 4.76 percent while Year-on-year (YoY), the volume of transactions approximately doubled and the value of transactions increased by 75 percent.
The UPI crossed 1 billion transactions for the first time in October 2019 which is after three years of its establishment. However, the next 1 billion transactions came under a year in October 2020. Then in the next ten months, it reached 3 billion transactions. The platform then took only three months to reach 4 billion transactions from 3 billion. After that, the platform achieved its next billion within six months and another billion in the next six months.
Moreover, covid 19 pandemic accelerated the adoption of digital payments platforms in the past 2 years. Now, UPI transactions are the most used payment method and are increasing as the major economy recovers.
Furthermore, UPI processed over 46 billion transactions adding to over Rs 84.17 trillion in FY22. On the other hand, in FY21, UPI had processed 22.28 billion transactions, amounting to Rs 41.03 trillion. Hence, in just a year, the volume and value of transactions doubled specifying the rapid increase in the adoption of digital payments in the country.
The digital payment index (DPI) launched by the Reserve bank of India (RBI) rose to 349.30 as of March 2022 which was only 304.06 in September 2021 indicating the rapid adoption of digital payment across the country. DPI was launched in January 2021 and it indicates the extent of digitization of payments across India. In March 2019, the index was at 153.47 and it rose to 173.49 by September 2019, after it was 207.94 in March 2020, 217.74 in September 2020, and 270.59 in March 2021.
The aim of UPI in the next five years is to process 1 billion transactions in a day. Also after the RBI decision to allow the linking of Rupay credit card to UPI will surely provide a huge boost to volume as well as the value of transactions in the upcoming months.
Dilip Asbe, Chief executive officer of NPCI during an event on Rupay credit card and UPI linkage said that the company is seeking how they can expand the market. The aim is to reach 250 million users and banks can start doing smaller credits. They are also seeking how the 50 million merchants can start accepting credit. Also, the officials have to take care of small merchants and protect them from MDR (Merchant Discount Rate). The merchants can continue to pay through existing credit card services.