The government-backed Unified Payments Interface (UPI) crossed 100 million monthly transactions for the first time in November, according to data released by the National Payments Corporation of India (NPCI) — which manages all retail payments systems in India. UPI recorded 105 million transactions last month, growing 38 percent since October. The value of transactions touched $1.5 billion (roughly Rs 9,680 crore) growing 40 percent from October when it stood at $1.07 billion (around Rs 7,030 crore).
The surge has been led by two factors primarily. One, more banks now fall under the UPI ambit. At last count, there were 60 public and private Indian banks that allowed funds transfer and other transactions via the UPI platform. And second, the entry of global tech giants like Google and PayPal that offer payments apps built on the UPI architecture has fueled growth. Google recently announced that its peer-to-peer payments app, Tez, has 12 million users and has recorded 140 million transactions. Google will soon roll out merchant payments on the UPI-enabled Tez app.
Besides Google and PayPal, WhatsApp’s soon-to-be-launched payments interface will run on UPI as well. That is likely to give a major flip to not only UPI but also the government’s cashless economy drive. Other homegrown payment services like PhonePe too contribute significantly to overall UPI transactions. Then there’s BHIM, which until last year accounted for nearly half of all UPI payments. But BHIM seems to be losing a bit of sheen lately.
Though BHIM’s transaction volumes have grown, its share in the UPI pie has been declining steadily. It fell to under 10 percent for the first time in October, and further dropped to an all-time low of 7.8 percent in November. BHIM transaction volumes though grew to $397 million (Rs 2,553 crore) last month from $365 million (Rs 2,348 crore) a month ago. In a bid to rejuvenate BHIM, the government has now mandated all UPI-led banking apps to sport ‘BHIM’ as a prefix to their names. So, SBI Pay is now BHIM SBI Pay, for instance. NPCI has also notified all banks to place BHIM prominently at merchant checkout locations across the country.