Digital India is a failure. Digital economy cannot exist in India. India is too illiterate to understand the digital payment process. These were the claims made by self-proclaimed economists when India was prepping up for the digital world.
But here we are. The demonetization and its contribution have made India a global leader in the digital economy. In the last six years, millions of Jan Dhan accounts have been opened, and the people at the bottom of the pyramid are using digital payments. However, what came as an even more satisfying development is that UPI payment has breached the $1-trillion mark in transaction values for the financial year 2021-22.
UPI’s watershed moment with its record-breaking digital payments
The UPI payment system has touched a major milestone with its substantial growth over the past two years. As per the data released by the National Payments Corporation of India (NPCI) which deals with the management of UPI payments, “UPI has recorded transaction values of Rs 83.45 lakh crore in FY22.” Notably, $1 trillion amounts to approximately Rs 75.82 lakh crore as per the current conversion rates.
It is the first time that the payments system crossed the 500-crore mark in volumes in March. As per NPCI’s data, 504 crore transactions were already done by March 29 itself.
Moreover, transactions worth Rs 8.88 lakh crore was witnessed as of March 29, which was 7.5 per cent more than February. UPI has witnessed a dramatic rise in transactions and that is mainly because of the pandemic that led to the widespread adoption of digital payments in India.
According to a Macquarie Securities report, “UPI also commands a lion’s share in the volume of total retail payments made in the country. In FY22, around 60 per cent of the volume of India’s retail payments were done through UPI.”
India is the global e-payment leader
Witnessing the current growth in UPI payments, it is being speculated that in the next 3-5 years, UPI could process a billion transactions a day. A number of initiatives and plans have been brought in to ensure the same. However, the most prominent among the e-payment is UPI’s AutoPay feature. According to industry experts, “the AutoPay feature will be crucial to increasing daily transactions on the platform.”
The NPCI has also introduced an “on-device” wallet feature for digital payment users — known as UPI Lite for the small value transactions made on UPI.
According to data released by the National Payments Corporation of India (NPCI), earlier in December, 4.56 billion UPI transactions worth Rs 8.27 trillion were recorded. Though November witnessed a marginal dip, UPI transactions in October and likewise in December had reported record high transactions of 4.21 billion, worth Rs 7.71 trillion.
UPI has been welcomed ever since it was launched in 2016. It was frequently used especially after the Covid-19 outbreak and thus crossed 1 billion transactions for the first time in October 2019. In October 2020, another history was made when UPI processed more than 2 billion transactions for the first time. Further, it took only 10 months to become 3 billion from 2 billion transactions that vindicated the popularity of UPI among the users. Well, the journey did not stop here. The payments platform, in just 3 months, reached 4 billion transactions. And, for three consecutive months (October, November, and December) 4 billion transactions were recorded.
The success story will only continue with its recent watershed moment to create another record.