The Unified Payments Interface, or UPI as it is more commonly known, touched over 4.2 billion transactions in October, a new all-time high for the payment network since its inception, fueled by the festive season.
In terms of value, the payments platform recorded transactions totaling Rs 7.71 lakh crore (about $103 billion) in October, creating a new record. In September, UPI recorded 3.65 billion transactions valuing Rs 650 crore. In October, UPI experienced a 15 percent surge in transaction volume and an 18.5 percent increase in transaction value month-on-month. In addition, the volume of transactions almost doubled year on year, while the value of transactions increased by about 100 percent.
The sharp rise in October is mostly due to increasing demand for online shopping during the festive season sales. The slow but steady reopening of the economy following the end of the second wave has also benefited this growth.
The payments platform went from 3 billion to 4 billion transactions per month in just three months, illustrating the country’s rapid acceptance of digital payments in the last 18 months or so. UPI has been generating over 3 billion transactions per month for three months in a row, starting in July. And, with the economy on the way to recovery and the festive season in full swing, UPI was predicted to hit 4 billion transactions per month shortly.
Since its inception in 2016, UPI has accomplished a number of remarkable milestones. In October 2019, it surpassed a billion transactions for the first time, and the next billion came in less than a year. The monthly transaction value has increased by about 79 percent since the beginning of 2021, from Rs 4.31 lakh crore in January. Meanwhile, the number of transactions has skyrocketed by more than 83 percent from 230 crores in January.
Furthermore, other forms of digital payment witnessed a significant increase in October. Immediate Payments Service (IMPS) also reached an all-time high in terms of transaction volume and value. In the month, it recorded 430.67 million transactions worth Rs 3.70 trillion.
In October, the NPCI’s National Electronic Toll Collection (NETC) channel, which operates FASTag, registered an all-time high of 214.23 million transactions worth Rs 3,356.74 crore, jumping 10.7 percent in volume and 11 percent in value from the previous month. showing the revival of road traffic with most states relaxing Covid-19 travel restrictions. It generated 193.6 million transactions totaling Rs 3,000 crore in September, compared to 201.2 million transactions amounting to Rs 3,076.56 crore in August.
While addressing the Global Fintech Fest on September 29, Dilip Asbe, the Managing Director and CEO of National Payments Corporation of India (NPCI) estimated that by 2021, UPI would account for over 60 percent of all NPCI transaction volumes. Adding further he said, at the current rate, UPI can cross $1 trillion in daily transactions in five years, but that effort may be accelerated to accomplish the milestone in just three years.