PhonePe Leads In UPI Transactions With 47.7% Market Share In May, Google Pay Shrinks Further

The latest data from  National Payments Corporation Of India (NPCI) for the month of May, shows that Walmart-backed PhonePe increased its share of customer transactions (by value) marginally month on month. The UPI app now controls 47.73% of market share in the country. PhonePe processed customer transactions worth INR 2.34 Lakh Cr during the month. In April it had reported 47.4% market share.

Inc42 had reported that in April, both Google Pay and Paytm had lost 1% market share each on a month on month basis. In May, their market share shrank marginally although not as much as in April. Google Pay reported a market share, by transaction value, of 38.15% compared to 38.5% last month. Paytm reported a market share of 7.28% compared to 7.5% in April. 

Google Pay processed customer transactions worth INR 1.87 Lakh Cr while Paytm processed transactions worth INR 0.3 Lakh Cr. 

The remaining platforms to report the highest transaction volumes compared to the rest of the ecosystem include BHIM (1.38%), CRED (1.25%), Yes Bank (0.91%) and Amazon Pay (0.98%). 

Among these, CRED gained the maximum market share compared to 1.1% market share reported in April. It is important to note that Kunal Shah led CRED, in partnership with crowdfunding platform Milaap, had announced an initiative (April 26), where people could use their 10,000 CRED Coins towards sending 1,000 litres of oxygen to hospitals at a time when patients across the country were struggling with oxygen supply constraints. 

Similarly, the ecommerce platforms Amazon India (parent of Amazon Pay) and Walmart-backed Flipkart were given rights to deliver essential products across the country as states went into lockdown. It is possible that these external factors had an impact on the large number of transactions reported across these platforms.

Although UPI transactions recorded a jump in March, the staggered lockdowns introduced across states starting 14th April impacted consumer behaviour. The intensified covid-19 wave continues to affect UPI (unified payments interface) transactions in the country negatively. May data shared by NPCI  shows that transactions dipped marginally for the second month in a row. 

During May, NPCI reported 2.53 Bn UPI transactions, down 4% month on month compared to 2.64 Bn transactions in April. Value of transactions also registered a marginal decline to INR 4.90 Lakh Cr (down 0.6% month on month) compared to INR 4.93 Lakh Cr in April. In March 2021, UPI had reported its best ever figures with 2.73 Bn transactions amounting to INR 5.04 Lakh Cr.

Even as PhonePe continued to report the highest share of customer transaction volume in May at 46.42% of 2.4 Bn transactions, it was still down by 40 Mn compared to April transaction volumes. In April, PhonePe had reported 1189 mn transactions compared to 1149 Mn in May.