India’s digital payments growth skyrocketed as India stepped into the unlock phase after a strict nationwide lockdown in the first quarter of the current fiscal year 2020-21. During the fiscal’s second quarter, UPI payments recorded an 82 per cent jump in volume and a 99 per cent jump in value, compared with the same quarter last year, according to the Worldline India Digital Payments report. In September 2020, UPI clocked over 180 crore transactions in volume and breached Rs 3 lakh crore in terms of value.
In Q2, 19 banks joined the UPI ecosystem, bringing the total number of banks providing UPI services to 174 as of September 2020 while NPCI’s BHIM App was available for customers of 146 banks. The number of BHIM app downloads stood over 15.8 crores as of 13 October 2020, the report added.
It is to be noted that NPCI has recently given approval to WhatsApp to go live with UPI in a graded manner, starting with a maximum registered user base of 2 crores. Also, it has issued a cap of 30 per cent of the total volume of transactions processed in UPI, which is applicable to all Third-Party App Providers (TPAPs) and will be effective from 1 January 2021.
In the past few weeks, the Reserve Bank of India has announced several initiatives to enhance the digital payments space in India. “These initiatives are being welcomed by industry players as it is expected to leverage technology, spur innovation, enhance system efficiency, and strengthen the acceptance infrastructure,” said Deepak Chandnani, Managing Director, Worldline South Asia & Middle East. While contactless, faceless, and cashless transactions are becoming the preferred choice among consumers and merchants, it is important to note that this trend started pre-covid and is now accelerating, Chandnani added.
Meanwhile, in the quarter ending-September 2020, there were over 51.8 lakhs POS terminals deployed by merchant acquiring banks, which is 13 per cent higher than the same quarter of the previous year. Among these, private sector banks represent about 69 per cent of the POS terminal market while public sector banks account for 26 per cent. Payments banks accounted for 4 per cent of market share and foreign banks represent the rest 1 per cent.