Updated April 3rd, 2024 at 18:31 IST

UPI transaction volume sees 56% jump, smaller transactions on the rise: Report

The value of UPI transactions went up 44% from Rs 69.36 trillion to Rs 99.68 trillion in H2 2023 to H2 2022

Reported by: Business Desk
Online payment | Image:Unsplash
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The volume of UPI (Unified Payments Interface) transactions went up 56 per cent to 65.77 billion in the second half of 2023, according to a Worldline report.

The number was at 42.09 billion transactions in H2 of 2022.

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The Indian real-time payments system emerged as the pervasive choice for payments, the French  multinational payment and transactional services company said, adding that transactions  increased from Rs 12.98 trillion in January 2023 to Rs 18.22 trillion in December 2023.

The top 10 states and UTs with the highest number of transactions at physical touch points in 2023 were Maharashtra, Kerala, Tamil Nadu, Karnataka, Delhi, Telangana, Uttar Pradesh, Gujarat, Jharkhand and West Bengal.

Notably, the average ticket size (ATS) of transactions went down 8 per cent from Rs 1,648 in H2 2022 to Rs 1,515 in H2 2023, which shows that the payments interface is being used for smaller transactions, driven by person-to-merchant (P2M) transactions.

During the same period, the ATS of P2M transactions fell from Rs 720 to Rs 656, suggesting a 9 per cent reduction.

“This is a good trend since the future of UPI is going to be P2M transactions and indicates the rise of micro transactions indicating an increasing willingness to use UPI,” as per the report.

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The Top Players
 

Source: Worldline

PhonePe, Google Pay, and Paytm emerged as the top three dominant UPI apps in terms of volume and value. 

PhonePe led the transaction volume at 46.5 per cent, followed by Google Pay at 36 per cent and Paytm at 13 per cent.

The transaction value for PhonePe was also the highest at 49 per cent, followed by 34 per cent for Google Pay and 10 per cent for Paytm.

In terms of transaction volume, the 3 apps accounted for 95.4 per cent of all transactions, compared to 94.8 per cent a year before in December 2023.

The 3 UPI apps accounted for 93 per cent in December 2023, as compared to 92.2 per cent in Dec 2022 in terms of transaction value.

As per the report, the dominance was a mix of an early mover advantage of these apps, as well as the ease of use and features,discounts or deals offered on the apps.

The State Bank of India emerged on top among the remitter banks, or the third-party apps driving UPI transactions with 307 crore transaction volume, followed by HDFC Bank at 104 crore transactions, Bank of Baroda at 76.6 crore, Union Bank of India at 74.5 crore transactions and Punjab National Bank at 60.7 crore transactions.

Notably, Paytm Payments Bank emerged as the top beneficiary bank at 283.5 crore of total transactional volume, followed by Yes Bank at 226.9 crore, State Bank of India at 125 crore, Axis Bank at 96.7 crore and ICICI Bank at 64.7 crore.

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Highest Transactions

The highest UPI person to merchant (P2M) transactions were seen in groceries and supermarkets, followed by eating places and restaurants, telecommunications services, fast food restaurants and department stores.

Overall, mobile payments, driven by UPI and encapsulating a host of payments using bank accounts and the like saw the transaction volume touch 62.95 billion in H2 2023, jumping 38 per cent while the value of mobile transactions saw a 31 per cent jump at Rs 152.33 trillion.

The average transaction size for mobile app transactions was Rs 2,419 in H2 2023; which was down 5 per cent from the previous half year showing increased mobile phone usage for transactions, and how stable this medium has emerged for transactions in India.

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E-Tolls

The value of electronic toll collection in H2 2023 was Rs 319.48 billion, indicating a 20 per cent jump when compared to H2 2022 at Rs 267 billion.

The number of tags issued has grown 45 per cent from 55.94 million in July 2022 to 81.24 million in December 2023. 

In terms of volume, transactions in H2 2023 were at a 13 per cent growth of 1.89 billion compared to 1.67 billion in H2 2022.

 

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Published April 3rd, 2024 at 18:31 IST