The United Payments Interface, or UPI, has set a new record for digital payments in India. In March, the value of UPI transactions surpassed Rs 5 lakh crore, with 2.30 billion transactions, bringing the financial year 2021 to a close on a high note.
The platform, which was launched in April 2016, saw a rise in transaction value to Rs 5.04 lakh crore last month, up from Rs 4.25 lakh crore in February. UPI has grown at an exponential rate over the last year, with players like PhonePe, Paytm, and Google Pay capturing the largest market shares.
UPI has seen a double-digit monthly increase in transaction counts through the month of last year's lock-down, at the start of the pandemic, and the change in consumer behaviour towards digital payments.
However, the rising numbers come as the National Payments Corporation of India (NPCI) considers capping each company's UPI market share.
In addition, two big platforms dominating UPI transfers have been concerned with concentration risk. Phone Pe was 44% in February while Google Pay accounted for 40% of total UPI volumes.
|Month||Transaction in crore||Transaction volume in billion|
|January 2021||Rs 4,31,181||2.30|
|February 2021||Rs 4,25,062||2.29|
|March 2021||Rs 5,04,886||2.73|
According to the NPCI, UPI transactions on third-party payment apps cannot account for more than 30% of the total volume of UPI transactions processed in the previous three months. The cap will come into force on 1 January 2021, but existing third-party operators such as Google Pay and PhonePe will be required to comply with the new rules before 2022 with 40 percent market share.