The National Payments Corporation of India (NPCI) on Monday announced that its flagship payment infrastructure, Unified Payments Interface (UPI), has crossed the 10-million-transaction mark in June 2017.
According to the NPCI, the transaction volume has risen to 10 million in just 11 months from less than one million in August 2016, when it went live.
The UPI volumes include numbers from BHIM, their mobile-based app, and USSD 2.0, a message-based transfer service.
Further, the NPCI said that in the last three months UPI transactions had grown successfully from 7.2 million to 9.36 million to 10.35 million in April, May and June 2017, respectively.
YourStory verified this with representative data from the Reserve Bank of India (RBI). The total volume of UPI transactions stood at 9.2 million for the month of May, with close to Rs 2,770 crore in value transferred and paid across the network.
According to RBI data till June 25, UPI had touched 10 million transactions with Rs 2,550 crore in value.
At present, UPI is offered by about 50 banks.
Speaking on the occasion, AP Hota, MD & CEO, NPCI said,
“Transactions on UPI is growing exponentially due to increased acceptance among member banks, merchants and consumers. Usage of UPI powered BHIM app (Bharat Interface for Money) has also been a significant contributor. Our current focus is on the release of next version of the BHIM app with enhanced functionalities.”
Of the total UPI transaction volume, only about 22 per cent are merchant based, with a large chunk being peer-to-peer transactions.
Just this month the news came out that two of India’s biggest banks HDFC and SBI will start charging customers for P2P UPI transactions from July 10 and June 1, respectively. However, in a follow-up report it was stated that the NPCI may ask banks not to charge for payments made through UPI.
But, according to guidelines, this is only for P2P transactions, since P2M (merchant transactions) remains free.
Who's market leader anyway?
At present, NPCI’s consumer-facing payment application BHIM is reported to have 42 percent market share in May, a slip from the 44 percent in April.
With other private players like Chillr and behemoths like WhatsApp and SamsungPay trying to leverage the UPI platform, this might result in a further drop in BHIM’s market dominance.
Last month, Paytm Payments Bank also announced plans of going live on UPI by August this year.
Interestingly, these private players might also be predominantly responsible for growing the merchant acceptance network for the payment infrastructure. For example, last month, PhonePe founders Sameer Nigam and Rahul Chari claimed that merchant transactions on their platform contributed to almost 60 percent of the total transactions in May. The same number stood at a mere 10 percent in December, with P2P transactions contributing to 90 percent of the overall volumes.
Further, according to the industry, UPI 2.0 is all set to be launched in September this year with newer features like recurring payments to make the process even more frictionless.
Tarush is driven towards delivering unbiased and accurate reportage while engaging with as many mediums as possible to narrate a fresh perspective. Working for the past few years in the digital space with YourStory, he has covered the Indian technology ecosystem extensively, focusing on new age Fintech companies, while building strong connects within the industry.