UPI ends 2020 on high note, scales past Rs 4-lakh-cr milestone in December; volume up 70% from year-ago

UPI transactions ended 2020 on a high note. The value for digital transactions done via UPI stormed past the Rs 4-lakh-crore mark in December, according to the latest UPI data from the National Payments Corporation of India (NPCI). 2.23 billion transactions worth Rs 4.16 lakh crore were recorded in December, up from 2.21 billion transactions involving Rs 3.91 lakh crore in November. The year-on-year growth in volume stood at 70 per cent from 1.30 billion transactions while the value of UPI transactions increased 105 per cent from 2.02 lakh crore in December 2019. Moreover, the number of banks live on the UPI platform increased from 143 to 207 during the 12-month period.

Among the leading UPI players, Google Pay and PhonePe had together cornered over 82 per cent of the market by volume and over 86 per cent by value in November. While Google Pay processed 960.02 million transactions involving Rs 1.61 lakh crore, PhonePe, saw 868.4 million transactions worth Rs 1.75 lakh crore. Paytm had processed 260 million payments.

The transaction volume and value have apparently scaled up faster during the Covid and lockdown phases as people switched to digital mode to avoid cash usage. The volume jumped by 908.47 million transactions during the 10-month period from 1.32 billion transactions in February 2020, according to the analysis of NPCI data. However, in comparison, similar volume growth of 908.47 million transactions, before Covid, took 17 months (from September 2018) to reach the February 2020 level.

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UPI is currently the biggest among the NPCI operated systems including NACH, IMPS, AEPS, BBPS, RuPay, etc. As of October FY21, out of 3.39 billion retail transactions on all NPCI platforms, 2.07 billion transactions were recorded on UPI followed by 340.03 million transactions with respect to NFS inter-bank ATM cash withdrawals, 318.97 million transactions on the instant payment inter-bank electronic funds transfer system — Immediate Payment Service (IMPS), and 245.55 million transactions on the National Automated Clearing House (NACH), according to the NPCI data.

Importantly, the Reserve Bank of India had on Friday launched a ‘composite Digital Payments Index (DPI)’ to measure the extent of digitisation of payments in India based on parameters including payment enablers, payment infrastructure – demand-side and supply-side factors, payment performance, and consumer centricity, according to the RBI.