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India sees first dip in UPI payments in at least a year

India sees first dip in UPI payments in at least a year
3 May, 2021

In April, India carried out payments across 2.64 billion transactions, totaling about Rs 4.94 trillion, using Unified Payments Interface (UPI), as per National Payments Corporation of India (NPCI) data. 

As per NPCI’s tweet on Saturday, the transaction volume figure is down 3% from 2.73 billion in March. Accordingly, the transactional amount has also dipped nearly 8% from about Rs 5.05 trillion in March. 

As per TechCircle's review of UPI transaction since April 2020, April 2021 has recorded the first ever month-on-month dip, both in volume and value terms. 

India is currently battling the second wave of the Covid-19 pandemic, with the total tally of coronavirus infections rising to over 19.9 million, as per government data on Monday. As of Monday, the country had recorded more than 300,000 new cases 12 days in a row.  

The second wave-associated restrictions on non-essential businesses and activities, across multiple cities in the country, are a likely factor for the dip in UPI numbers. 

Late last month, Chennai based financial services company Financial Software and Systems (FSS) partnered with NPCI International Payments (NIPL) to expand the presence of digital payments platform UPI in international markets. 

Read: Meet the consortiums knocking on RBI’s doors for NUE licences   

India’s fintech landscape has been, for a while, trying to break several monopolies in the UPI ecosystem of payments, whether in NPCI’s control of the underlying technology, or the volume of transactions.  

In March, NPCI released a nine-page standard operating procedure (SOP) to monitor the 30% market share cap for third party application providers (TPAP) such as Google Pay, Paytm, and PhonePe. 

Incorporated as an initiative of the Reserve Bank of India (RBI) and Indian Banks' Association (IBA) in 2008, NPCI works as an umbrella organisation for operating retail payments and settlement systems in India. 

Apart from UPI, NPCI’s products include RuPay card, Immediate Payment Service (IMPS), Bharat Interface for Money (BHIM), BHIM Aadhaar, and National Electronic Toll Collection (NETC FASTag), and Bharat BillPay.