Transactions over the Unified Payments Interface (UPI) increased 5.8% to reach a new all-time high of 19.47 billion in July. Year-over-year (YoY), the number of transactions increased by 35%. The number of transactions decreased to 18.40 billion in June.
Transaction Value Rises to INR 25.08 Lakh Cr
UPI transactions in July were INR 25.08 Lakh Cr, up 4.3% from INR 24.04 Lakh Cr in the previous month, according to data from the National Payments Corporation of India. Prior to this, the amount of UPI transactions reached an all-time high of 18.68 billion transactions in May.
Compared to 613 million in June, the average daily transaction count increased to 682 million in the reviewed month. In addition, the average daily transaction value in July was INR 80,919 Cr.
PhonePe, Google Pay, and Paytm: Who Dominates UPI?
Nearly 50% of the overall transaction amount and 46.5% of all UPI transactions in June were made through PhonePe. Paytm maintained a 6.9% volume and 5.6% value share, while Google Pay held a 35.6% volume and 35% value share. The nation’s most popular digital payment system for merchant and peer-to-peer transactions is still UPI, which was created by NPCI.
UPI’s Global Expansion via PayPal, Venmo, Tenpay
The government is pursuing a number of steps to expand UPI’s reach globally, even as it continues to gain traction locally. The international division of the National Payment Corporation of India (NPCI) and the US-based online payment gateway PayPal collaborated last month to create PayPal World, a global digital payment platform.
Users will be able to utilise UPI and their other native payment systems, such as PayPal’s Venmo, China’s Tenpay Global, and Latin America’s Mercado Pago, to send money abroad or pay for foreign commerce.
UPI will record more transactions with new international users as a result of this improvement. RBI governor Sanjay Malhotra stated in March that the central bank intends to keep extending UPI’s reach “bilaterally” by connecting its payment infrastructure with other countries’ quick payment systems.
RBI Raises Concerns on UPI’s Sustainability
Although NPCI’s digital payment system keeps growing, the RBI is apprehensive about its long-term viability. The RBI governor stated last month that modifying the free digital transaction system to include minor fees is essential to UPI’s financial viability.
According to him, the government has been paying for the smooth, real-time payments infrastructure by subsidising banks and other stakeholders, as the UPI system is currently free for customers.
However, in order to provide consumers with digital payment choices through smart devices, including as wearables, linked cars, and smart applications, NPCI is developing an internet of things (IoT) version of the UPI.
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