It has managed to reach March levels in terms of number of transactions, showing rapid adoption of UPI
In an interesting comeback, Unified Payments Interface (UPI) recorded 1.2 billion transactions in May having reached almost pre-COVID-19 levels of March this year. It jumped 21% from close to a billion transactions recorded in April this year.
In terms of the total amount settled through UPI, it recorded Rs 2.18 lakh crore up 45 percent from Rs 1.5 lakh crore settled last month.
While the number of transactions have shown a sharp uptick, March had still seen a slowdown from February when UPI recorded 1.3 billion transactions settling more than Rs 2.2 lakh crore. The lockdown came into effect in the third week of March bringing all forms of economic activity almost to a standstill.
Industry insiders pointed out that this jump in UPI could be driven by wider adoption of QR code based merchant payments. Now whether UPI Is eating into card payments is something that needs to be seen. Card payment numbers for May has not been released by the Reserve Bank yet.
NPCI did not release the break up between banks for May, however till April, State Bank of India continued to be the leader among all the banks. In the first four months of 2020, close to 1.3 billion transactions were done from an SBI bank account.
UPI is an interbank fund transfer mechanism which can be operated by consumers through a smartphone. While payments can be done via bank applications, PhonePe, Paytm and Google Pay are the three popular third-party payment apps in the country. Google Pay has been leading the race for the last few months in terms of number of transactions.
Besides UPI, NPCI shared number of IMPS (Immediate Payment Service) transactions undertaken in May. While UPI might have reached March levels, IMPS is still short by 23 percent at 166 million transactions. In March IMPS recorded 216 million transactions. IMPS is another inter bank fund transfer mechanism used by consumers typically for higher value transactions.
NPCI data around FASTag transactions for May showed a sharp jump to 55 million from 10 million in April. This showed that the country is limping back to some level of normalcy as national highways are opening up and vehicle movements have gone up.
