SUMMARY
UPI recorded transactions worth over INR 125.95 Lakh Cr ($1.52 Tn) in the calendar year 2022
In 2022, the month of March saw the biggest 20% month-on-month (MoM) jump in value of transactions
NPCI is targeting a billion UPI transactions a day and hopes to achieve it in five years
In December 2022, the Unified Payments Interface (UPI) recorded 782 Cr transactions worth INR 12.82 Lakh Cr ($154.9 Bn) in India, a 7% increase from November 2022.
Meanwhile, the transaction count rose 7% month-on-month during the last month of 2022.
The year ended with a strong performance for digital payments, with UPI recording transactions worth over INR 125.95 Lakh Cr ($1.52 Tn) in the calendar year 2022, an increase of 72.5% from INR 73 Lakh Cr ($970 Bn) in the calendar year 2021.
Overall, the transaction value witnessed a year-on-year (YoY) growth of 55% in December 2022, while transaction volume increased 71.5% from December 2021.
Contactless digital payments, such as mobile wallets and UPI, have continued to gain popularity in India even as the impact of the Covid-19 pandemic has subsided.
Since its launch in 2016, UPI has become a popular choice for money transfers in India, with the number of transactions growing from a mere 90 Lakh in July 2016 to over 782 Cr in December 2022.
What’s In Store For UPI In 2023?
The volume and value of Unified Payments Interface (UPI) transactions in India have steadily increased over the past two years, with only minor disruptions caused by COVID-19-related restrictions.
In 2022, the month of March saw the biggest month-on-month (MoM) jump of 20% in value of transactions, with minor dips in February, June and November.
This trend also reflects the overall recovery in the economy and the growing adoption of digital payment methods for everyday transactions by consumers.
Talking about the success of UPI, Spice Money founder Dilip Modi said, “[UPI] has grown not only in the urban parts but also in the rural parts of India, helping masses easily transact and avail services. In 2023, we expect UPI to achieve even greater heights and help [India] transact swiftly and securely.”
Experts predict that UPI is likely to cross the transaction volume benchmark of 800 Cr and transaction value benchmark of INR 13 Lakh Cr in January 2023. The National Payments Council of India (NPCI), too, is targeting a billion transactions a day and hopes to achieve it in five years.
Merchants are also optimistic that enabling UPI transactions via RuPay credit cards will further the digital payments ecosystem in the country.
One bottleneck that still plagues the ecosystem is the duopoly of fintech giants PhonePe and Google Pay. While the National Payment Corporation of India (NPCI) came out with the third-party applications’ market cap restrictions, the guidelines are yet to be implemented. In December 2022, the NPCI pushed the deadline for the fourth time to 2024.
