New Delhi: The number of transactions via real-time payments system Unified Payments Interface (UPI) continued to rise, clocking 1.2 billion transactions in November, National Payments Corp. of India (NPCI) data showed on Monday.
These transactions were 6.1% higher than in October, and 132% higher on a year-on-year basis, the data showed.
UPI allows users to transfer money any time, on a real-time basis, across multiple bank accounts, without revealing details of one’s bank account to the other party. The simple, hassle-free three-year old payment system is popular among the masses.
These transactions were worth ₹1.89 trillion in November compared to ₹1.91 trillion a month ago. Currently, 141 banks are live on UPI.
“Although the number of transactions have increased, value-wise the numbers are flat since it is being contrasted with the festive spending in October. However, a rise is expected once again with the upcoming New Year and Christmas celebrations," Mandar Aagashe, founder and vice chairman of Sarvatra Technologies said.
In October, Reserve Bank of India-backed NPCI’s Chief Executive Officer Dilip Asbe had told Mint that UPI user base is expected to expand five-fold to 500 million in the next three years. Currently, it has over 100 million users.
Transactions via NPCI’s UPI-enabled payments system BHIM, however, fell 7% month-on-month in November to touch 16.96 million. Such transactions were worth ₹58.53 billion in November as compared to ₹63.39 billion a month ago. BHIM faces stiff competition from private entities such as GooglePay, Paytm, PhonePe, among others that have the lion’s share as far as UPI-based payment is concerned.
While India’s payments system is at an inflection point, where cash transactions continue to dominate, the government and the banking regulator has been working towards higher adoption of digital payments and making India ‘less-cash economy’.
According to RBI, digital payments constituted a high 96% of total non-cash retail payments during October 2018 to September 2019. During the same period, popular e-payments systems National Electronic Funds Transfer (NEFT) and UPI handled 252 crore and 874 crore transactions with a year-on-year growth of 20% and 263%, respectively.
“A drastic growth (in UPI) will be seen once a large set of the population residing in the rural areas starts using it more frequently. Enhancing awareness among retailers and end consumers will go a long way in bringing in an exponential rise in UPI," Anand Kumar Bajaj, Managing Director and Chief Executive Officer of PayNearby said.