New Delhi:

Surpassing world’s leading digital payments platforms, India’s Unified Payments Interface (UPI) processed nearly Rs 81 lakh crore transactions in the April-July period this year, which is a staggering 37 per cent increase (year-on-year).

According to latest data by global payments hub Paysecure, UPI processed 3,729.1 transactions per second — a 58 per cent surge over the 2,348 transactions every second registered in 2022— surpassing China’s Alipay, Paypal and Brazil’s PIX in the number of transactions, the data showed.

In July, UPI transactions crossed Rs 20.6 lakh crore — the highest-ever during a month. The value of UPI transactions processed remained above Rs 20 lakh crore for three consecutive months.

Paysecure examined 40 of the top alternative payment methods from around the world to reveal this data.

The findings showed that India leads the world in digital transactions, with over 40 per cent of payments being made digitally, and UPI being used for a majority of them.

According to Dilip Asbe, CEO of National Payments Corporation of India (NPCI), UPI has the potential to touch 100 billion transactions in the next 10-15 years backed by credit growth. Credit has already been launched on UPI and the commercials would be released within in a couple of weeks.

Official figures show that as many as 13.89 billion transactions were recorded on UPI in June up from 14.04 billion in May. According to consultancy firm PwC India report, the number of transactions on UPI is expected to jump more than 3-fold from about 131 billion in 2023-24 to 439 billion by 2028-29, accounting for 91 per cent of total retail digital transactions.

According to RBI Governor Shaktikanta Das, based on the encouraging response received from several jurisdictions, the apex bank is now focusing on making “UPI and RuPay truly global”.

At the ‘Global Fintech Fest’ in Mumbai this week, he said that the deployment of UPI-like infrastructure in foreign jurisdictions, facilitating QR code-based payment acceptance through UPI apps at international merchant locations, and interlinking UPI with Fast Payment Systems (FPS) of other countries for cross-border remittances are on top of their agenda,

UPI is India’s mobile based, ‘fast payment’ system that facilitates customers to make round the clock payments instantly using a Virtual Payment Address (VPA) created by the customer.
| Photo Credit: Photo Credit: X/@UPI_NPCI

“India and South East Asian nation Cambodia are negotiating collaboration in Unified Payment Interface-based (UPI) digital payment to promote trade and tourism,” the Commerce Ministry said on June 20.

Both sides also deliberated upon diversification of the trade basket by identifying new products, bilateral investment treaty, recognition of Indian pharmacopoeia and collaboration in the pharma sector.

These issues among others were discussed during the second meeting of the India-Cambodia Joint Working Group on Trade and Investment (JWGTI), in New Delhi on June 19.

Pharmacopoeia is a set of standards and quality specifications for ingredients, preparation and dosage forms of medicines manufactured, sold, consumed and exported in a country.

Indian Pharmacopoeia Commission (IPC) is an autonomous institution under the Ministry of Health and Family Welfare which sets standards for all drugs that are manufactured, sold and consumed in India.

“The meeting discussed the progress of the ongoing efforts for collaboration in UPI-based digital payment to promote trade and tourism,” it said in a statement. India has already collaborated with countries like the UAE on UPI.

The meeting was co-chaired by Joint Secretary in the Department of Commerce Siddharth Mahajan and Director General for International Trade in the Cambodian Ministry of Commerce Long Kemvichet.

Mr. Mahajan mentioned the measures for deepening bilateral trade and investment and also emphasised on creation of mechanisms for cooperation and collaboration in sectors of mutual interest. The Cambodian side elaborated on the numerous investment opportunities that Cambodia presents for Indian businesses.

The JWGTI was first held in July 2022 virtually. This was the first physical meeting after it was institutionalised. Cambodia is a member of the 10-nation Asian bloc. Asean (Association of southEast Asian Nations) members include Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam. India has a free trade agreement with Asian and it was implemented in 2009.

The bilateral trade between India and Cambodia has increased to $403.78 million (exports $185.39 million and imports $218.4 million) in 2023-24 from $366.44 million in 2022-23.

The principal commodities exported from India are pharmaceutical products, bovine meat, motor vehicles (autos, motorcycles and spare parts), raw hides and leather, and chemicals. The main imports include chemicals, vegetable oil, articles of apparel and clothing, and footwear.

New Delhi:

India will again delay caps on market share for a popular digital payments method, two sources told Reuters, benefiting Google Pay and Walmart-backed PhonePe as the authorities prioritise growth over concerns about market concentration.

The National Payments Corporation of India (NPCI), the quasi-regulator, will extend by as much as two years a year-end deadline to cap at 30% the market share of any company processing payments via the Unified Payment Interface (UPI), the sources with direct knowledge of the matter told Reuters.

PhonePe’s share of UPI payments has risen to 48.3% from 37% in April 2020, while Google Pay’s share has declined to 37.4% from 44%, according to NPCI data. The two processed a combined 11.5 billion transactions in April, the data showed.

NPCI and Google Pay declined to comment. PhonePe did not respond to an email seeking comment.

India launched UPI in 2016 but barred companies from charging for the instant digital payments service in an effort to promote online transactions and reduce the use of cash in Asia’s third-largest economy.

Because they cannot charge for it, India’s banks and others like Meta-owned WhatsApp and Amazon Pay have not pushed UPI-based payments aggressively, leaving authorities worried about a concentration risk.

While their apps do not earn money from the payments, PhonePe and Google Pay have been able to use their UPI customer base to sell services such as loans and insurance.

NPCI, which has a regulatory mandate from the central bank, announced the 30% cap in 2020 but later extended the deadline by two years to the end of 2024.

The deadline will have to be extended again, said one of the sources, as it is not possible for PhonePe and Google Pay to reduce their market shares without hurting UPI payments growth.

A final decision on the extension will be communicated closer to the deadline, said the sources, who asked not to be identified because they are not allowed to speak to the media.

NPCI had hoped for more competition when WhatsApp was permitted to offer UPI-based payments in February 2020, but the company had just 0.2% market share as of April.

India’s Paytm, with the third-highest share, has experienced a decline in payments processed through its platforms after regulators placed curbs on a group entity.

Payment firms want the market-share cap removed, asking NPCI to let them charge for UPI payments to encourage competition, said an official at a payment company.

The government will decide whether to allow firms to charge for UPI payments, the two sources said, but one said NPCI does not favour removing the share cap.

The volume of UPI transactions rose 49.5% in April from a year earlier, less than the 54% rise logged March.

The central bank met on Tuesday with industry executives to brainstorm on ways to expand the UPI user base, which was about 300 million users and 50 million merchants late last year, according to the most recent data.

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)

Image for representation only
| Photo Credit: C. Venkatachalapathy

The Reserve Bank of India has proposed to facilitate cash deposit facility in banks through the use of UPI, an instant real-time payment system for inter-bank transactions through mobile phones.

ALSO READ | RBI Monetary Policy LIVE updates 

“Given the popularity and acceptance of UPI, as also the benefits seen from the availability of UPI for cardless cash withdrawal at ATMs, it is now proposed to facilitate cash deposit facility through use of UPI,” RBI Governor Shaktikanta Das said in the Monetary Policy Statement, released on April 5, 2024.

The Cash Deposit Machines (CDMs) deployed by banks enhance customer convenience while reducing cash-handling load on bank branches. The facility of cash deposit is presently available only through use of debit cards.

Operational instructions regarding cash deposits using UPI will be issued shortly, according to the central bank.

RBI to permit linking PPIs with UPI apps

The RBI has also proposed to permit linking of Prepaid Payment Instruments (PPIs) through third-party UPI applications to provide more flexibility to users.

At present, UPI payments from bank accounts can be made by linking a bank account through the UPI app of the bank or using any third-party UPI application. However, the same facility is not available for PPIs.

PPIs can currently be used to make UPI transactions only by using the application provided by the PPI issuer.

“To provide more flexibility to PPI holders, it is now proposed to permit linking of PPIs through third-party UPI applications. This will enable the PPI holders to make UPI payments like bank account holders,” the RBI said.

Instructions in this regard too will be issued shortly.