Macro Economy

UPI transactions decline 4.5% in July

Priyanka Pani Mumbai | Updated on August 01, 2018 Published on August 01, 2018

UPI (Unified Payment Interface) transactions witnessed a 4.5 per cent decline in volume at 235.65 million in the month of July vis-a-vis the preceding month, which saw a 30 per cent jump in transaction volume over the previous month.

However, the transaction value went up marginally from ₹40,834 crore in June to ₹45,845 crore in July, according to the latest data released by National Payments Corporation of India (NPCI). NPCI, which owns the UPI payment platform, has not cited any reason for the decline in transaction volume but interestingly the IMPS transactions have gone up by 5 per cent during the month, as per the NPCI data. The UPI transactions for August might see a further decline as NPCI has banned bank transfers, using UPI ID, within the same account from August 1. The UPI transactions declined despite government’s initiative to push such transactions by the way of strong promotions and cashbacks.

Meanwhile, PhonePe, a digital payments platform owned by Flipkart, said it has emerged as the single largest player on the UPI network, ahead of other payment apps like Paytm and Tez. PhonePe also crossed the 100 million transaction mark in July, becoming the fastest Indian digital payments company to achieve this feat. NPCI reported that its UPI platform saw 236 million total transactions in July 2018. Of these, PhonePe had the largest market share of 40 per cent, the company said in a statement.

Sameer Nigam, CEO and Co-Founder of PhonePe, said,“Our growth in market share is largely fuelled by two factors. One, we have added lakhs of new offline and online merchants on our platform and are seeing exponential growth in merchant transactions.”

“Two, NPCI recently started blocking any UPI transactions where the sender and receiver bank account number are the same. This block by NPCI has effectively limited the ability of certain companies from incentivising shell transactions and artificially inflating their UPI numbers.”

As a result of these two factors, PhonePe’s market share of UPI transactions has jumped, said Nigam.

Published on August 01, 2018
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