Bengaluru accounted for the highest number of digital transactions in India in 2019, followed by Chennai, Mumbai and Pune, while United Payments Interface (UPI) was the most preferred mode of payment, said a new report by online payment processor Worldline India.
Bengaluru was the leading city in digital transactions in 2018 as well.
UPI was followed by debit cards, immediate payment service (IMPS), and credit cards, in terms of volume share of digital transactions.
“…In 2019, these four payment modes recorded a combined transaction volume of over 20 trillion and a combined value of over Rs54 trillion. UPI is also the fastest payment mode to hit 1 billion monthly transactions," the report said.
The report said that “merchants in grocery, restaurants, fuel stations, apparel stores, and specialty retail recorded the highest volume share of transactions in 2019."
Even though Bengaluru topped the list in term of online payment volumes, the state of Maharashtra led the pack among the top 10 states with the highest number of digital transactions. States including Karnataka, Tamil Nadu, and Delhi held the next three positions in term of online payment volumes, added the report titled ‘Wordline India Digital Payments 2019.
National Payment Council of India (NPCI) operated UPI recorded around 10.8 billion transactions in 2019, a 188% year-on-year (YoY). In terms of value, UPI facilitated transactions worth Rs18.36 trillion in 2019, up 214% YoY compared to 2018.
On the other hand, the transaction value of debit cards stood at Rs6.8 trillion in 2019 while transaction value of credit cards stood at Rs7.1 trillion in the same year, registering YoY growth of 21% and 33% respectively.
Number of debit cards transactions at point-of-sale (PoS) terminals stood at 4.9 trillion in 2019, a 16% growth as compared with previous the year. While the number of credit card transactions at PoS machines stood at 2 trillion in 2019, achieving a 20% YoY growth.
The outstanding number of debit cards declined from 923.39 million in January 2019 to 805.32 million in December 2019. While credit card issuance witnessed a growth of over 10 million cards from around 45.17 million in January 2019 to around 55.33 million credit cards in 2019, the report said.
However, the total number of transactions via UPI was 1.2 times higher the number of debit card transactions in 2018-19, the reserve bank of India (RBI) said in its 2018-19 annual report. Around 9 banks were added to UPI platform, taking the total number of banks providing UPI services to 143 as of December 2019.
Ever since UPI’s launch in 2016, the payment mode has received a larger push from both the central government and the RBI, placing UPI as a key product to help India move to a “less-cash economy". The move seems to have worked with, banks, fintechs, and payment wallets persuading its customer to use UPI for both merchant and P2P payments.
“…Apart from the government push, some of the key factors that helped UPI overtake other payment modes include the adoption of UPI 2.0 features by banks, enabling payments for IPO applications, facilitating foreign inward remittance, supporting donations for several relief programs, and numerous cashback and discounts offered by banks and fintechs," said the report.