UPI transactions reach 10 bn in Aug 2023

India has witnessed a surge in digital payments through the Unified Payments Interface (UPI), with transactions surpassing an impressive milestone of 10 billion in August 2023, according to a report by Worldline. Person-to-Merchant (P2M) transactions have primarily fueled this surge.

To provide context, back in January 2018, UPI transactions stood at 151 million in volume. Fast forward to June 2023, and this figure has skyrocketed to 9.3 billion, with P2M transactions driving much of this growth, as per the report.

Notably, in January 2022, P2M transactions accounted for 40.3% of all UPI transactions, which has surged to 57.5% by June 2023. This trend suggests that the percentage of P2M transactions is poised for further expansion.

A key indicator of future UPI growth, especially in P2M transactions, is the average ticket size (ATS). The report indicates that ATS for UPI P2M transactions, which stood at INR 885 in January 2022, has reduced to INR 653 by June 2023. This reduction indicates that UPI is increasingly employed for microtransactions, reflecting its deeper integration into various payment scenarios.

The report also highlights the impact of Electronic Toll Collection (ETC) on how tolls are paid on the country’s roads and, increasingly, at parking plazas and other locations. ETC has made the experience of driving on Indian roads significantly more convenient, and this adoption trend is evident in the data.

To illustrate, the number of ETC tags issued has surged from 45.97 million in January 2022 to 71.92 million by June 2023, representing a remarkable 56.5% growth. In terms of transaction volume, the first half of 2023 (H123) saw 1.85 billion transactions, compared to 1.57 billion in the first half of 2022 (H122), reflecting a 17.6% increase. Moreover, the value of ETC transactions in H123 reached INR 30,340 crore, marking a significant 25.3% upswing compared to H122.

Source: Economic Times