UPI transactions in October increases by 19% in volume

New Delhi: Monthly transactions through the unified payments interface (UPI) rose by 19% from 405.8 million in September to 482.3 million in October, according to data released by the National Payments Corporation of India (NPCI) on Thursday. The transaction volume growth in October is the lowest compared to the growth recorded over the last three months, with August witnessing a 32% rise and September registering a 30% increase.

However, the value of the transactions recorded in October has increased by 25% from ₹ 59,835.36 crore in the previous month to ₹ 74,978.27 crore. The transaction value growth is the highest recorded over the last three months. It had grown by 18% in August and 10% in September.

The slowdown in growth of the volume of transactions comes almost a week after NPCI limited person-to-person (P2P) UPI transactions to 10 a day from 20 previously.

“To encourage genuine transactions in the UPI ecosystem and bring in rationality, the UPI transaction frequency limit has been revised to … 10 transactions per bank account for P2P segment (in a span of 24 hours, where timestamp of 1st transaction is considered as start time),” said a circular issued by NPCI to “all members of UPI” on 21 October.

NPCI had asked banks to stop from 1 August transactions that originate from different UPI applications with the debit and the credit happening in the same account. This was aimed at curbing fake transactions and preventing fintech companies from inflating UPI numbers. “The data does not include transactions with debit/credit in the same account for the month of August,” NPCI said on its website, while releasing the figures of UPI transactions for August. Transactions that took place in October through the Bharat Interface for Money (BHIM) platform had not been released by NPCI at the time of publication. In September, 16.33 million UPI transactions amounting to ₹ 7,064.86 crore took place through BHIM.

One97 Communications Ltd, which owns and runs payments app Paytm, has said that it has recorded 179 million UPI transactions in October, as it claimed to hold 37% of the overall market.

Over the last six months, the digital payments firm has witnessed a seven-fold growth in the number of UPI transactions, it said. Paytm competes with transaction modes such as the government’s BHIM, Flipkart-owned PhonePe, and Google Pay. PhonePe had crossed the 100 million-transaction mark in July, Mint had reported.

UPI is a payments system launched by the NPCI, the umbrella organisation for all retail payments in the country. It facilitates instant fund transfer between two bank accounts on a mobile platform without requiring any information about the beneficiary’s bank account.

UPI was launched in August 2016 with 21 banks. It is now offered by around 128 banks.

komal.g@livemint.com