Indian payments organisation the National Payments Corporation of India (NPCI) recently stated that the total UPI transactions in the country for the month of January stood at 131 crore. This represents zero growth in total UPI transactions in January versus December 2019.
However, January witnessed a minor six percent increase in the total value being transacted on the UPI network. The total value of UPI transactions in January stood at Rs 2.16 lakh crore as compared to Rs 2.02 lakh crore in December 2019.
This comes at a time when Finance Minister Nirmala Sitharaman said there will be no MDR levied on transactions through homegrown payment networks including RuPay and UPI, in the last week of December.
Following this announcement, media reports suggested that Indian Banks, after weeks of discussion with NPCI, decided to not charge any fees on UPI and RuPay card transactions, as long as MDR (Merchant Discount Rate) remains zero.
Although NPCI agreed on waiving off interchange fee, according to a news report, the Indian payments body was still reviewing its stance on payments service provider (PSP) fee and switching fees.
Removing switching fee may result in a substantial revenue loss for NPCI, said the report.
IMPS follows UPI
Apart from UPI, NPCI also reported transaction numbers for other retail payment infrastructure including IMPS (Immediate Payment Service), NETC (National Electronic Toll Collection) and AePS (Aadhaar Enabled Payment System).
Total IMPS transactions in the country also more or less didn’t see any substantial increase and stood at 259.53 million in January, up from 256.47 million in December, last year.
The same stood for the total value of payments transacted through IMPS, which grew by merely 3 percent month-on-month and stood at Rs 2.16 lakh crore in January.
AePS and NETC show promise
However, the AePS transactions in the country grew at a healthy 18 percent to 225.47 million in January. The value of transactions on the network also grew by 21 percent month-on-month, showing some promise.
Government’s push to make FASTags mandatory for four-wheelers travelling on highways also seems to have a positive impact on the total number of digital transactions performed at toll booths.
In January this year, the total NETC transactions in the country stood at 93.02 million, up by 44 percent month-on-month. Even the total value transacted over the payment network stood at Rs 1,622 crore in January, up from Rs 1,257 crore in December.
(Edited by Megha Reddy)
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