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New Delhi: UPI ended December with a robust figure, recording new highs on both transaction volumes and value following the temporary slump in November. According to data obtained by the National Payments Corporation of India (NPCI), the digital payments system had 21.63 billion transactions in the month, and its significance in daily spending in the country is increasing.
In December, UPI transactions amounted to a total of Rs 27.97 lakh crore, and that is still almost six per cent up in comparison to November. The recovery has mostly been boosted by the increased consumer spending that happened in the festive seasons and the year-end holidays whereby individuals increased their spending in terms of shopping, travelling, eating and online services, reported by ET.
December continued on a downward trend and was a sharp reversal of November, whereby UPI volumes had declined marginally. UPI processed approximately 698 million transactions daily in November with an average transaction value of over Rs 90,000 crore. The growth was also strong, with the volumes increasing by 29 per cent and transaction value by 20 per cent year on year.
It was not only UPI that had the momentum. Stable improvement in other digital payment channels was also witnessed within the month, as more people move towards making transactions without the use of cash.
Immediate Payment Service (IMPS) transactions hit a new record of 380 million in December, as compared to 369M the previous month. The worth of IMPS transactions increased to Rs 6.62 lakh crore, which was lower than the month before, standing at Rs 6.15 lakh crore. FASTag transactions have also soared to 384 million, which shows that there were more road travellers and toll users during the holiday seasons.
The Aadhaar Enabled Payment System (AePS) was, however, heading the other way. There was a reduction in the AePS transactions to 95 million in December as compared to 108 million in November, although it indicated slight improvement on annual terms.
The number of UPI transactions made via PhonePe and Google Pay remained the most widespread as of November, and the data on apps is not announced by NPCI yet. Meanwhile, BHIM, Navi and Super.Money are smaller players that have been building more and more presence and have added to the competition within the payments space.
Industry observers observe that UPI has been increasing month after month, but other options in retail payment have either received no growth or grown at a slow pace.
NPCI is also narrowing down its scope to consumer safety as the volumes of transactions reach new highs. The organisation has been revising schedules of some of the UPI features, such as the planned closure of pull payments, which enable the user or merchant to request money from the customers.
Although most of the largest apps already disabled it when performing a person-to-person transaction, person-to-merchant transactions still use this in certain cases. The fraud worries have prompted NPCI to think of eliminating it over a gradual period despite UPI usage growing at a very high rate.
According to ICRA, NPCI has shown a 41.7 per cent increase in net profit to Rs 1,552 crore as of FY25. The annual increase in revenues was 19 per cent to Rs 3,270 crore, reflecting the robust financial results of the Indian backbone of digital payments.
