Digital payments see traction in August aided by rise in UPI usage
New Delhi: Digital transactions in August increased slightly from the previous month in terms of both value and volume, provisional data released on Wednesday by the Reserve Bank of India (RBI) showed. The month saw total digital transactions worth Rs109.82 trillion, up 2.27% from Rs107.38 trillion in July, according to the data.
The number of digital transactions increased marginally to 883.42 million in August from 861.07 million in July. The highest volume was recorded in December at 957.5 million. Digital transactions include those conducted through credit and debit cards, unified payments interface (UPI), unstructured supplementary service data (USSD), prepaid payment instruments (PPIs) and internet banking.
Transactions across UPI hit a record 16.61 million in August, against 11.44 million in the previous month. The value of such transactions rose around 22% to Rs4,127 crore in August from Rs3,381 crore in the previous month.
Since December, UPI transaction volume has risen more than seven-fold, according to the RBI data.
UPI is a payments system launched by National Payments Corp. of India (NPCI) that facilitates instant fund transfer between two bank accounts on mobile platform, without having any details of the beneficiary’s bank.
Transactions through UPI received a major stimulus from the government after Prime Minister Narendra Modi launched the BHIM (Bharat Interface for Money) app on 30 December. Around 45% of the UPI based transactions happen through BHIM, according to NPCI.
UPI was launched in August 2016 with 21 banks, and is currently being offered by about 55 banks. An upgraded version of UPI is expected to be launched by September end.
Debit and credit card usage at point-of-sale (PoS) machines rose by around 2.24% in August to around 243 million transactions from 237.6 million in the previous month. Card transactions of four banks have been considered by RBI. Usage of PPIs such as mobile wallets rose both in terms of volume and value in August. The value of transactions hit Rs2,722 crore, a new peak, against Rs2,530 crore recorded in May. It rose by 8.4% in August from Rs25.11 billion in July.
The volume of PPI transactions increased marginally by 1.1% to 89.7 million in August from 88.73 million in July. The provisional data considers transactions of PPI issued by eight non-bank issuers for goods and services transactions only.
Payments using National Electronic Funds Transfer (NEFT) and Real Time Gross Settlement (RTGS) increased by around 2.34% and 1%, respectively, in August from the preceding month.