A report titled ‘India Digital Payments Report’ prepared by Worldline India, which provides secured transaction payment services for banks, highlights that UPI has become a trendsetter in the payments domain:
UPI, or Unified Payment Interface, transactions recorded about 99% increase in volume and over 90% increase in value in Q1 2022, compared to the corresponding quarter in 2011, finds the ‘India Digital Payments Report’ by Wordline. In Q1 2022, UPI clocked over 14.55 billion transactions in volume and Rs26.19 trillion in terms of value, says the report, adding the top remitter banks were State Bank of India, HDFC Bank, Bank of Baroda, Union Bank and Paytm Payments Bank while the top Beneficiary Banks were Paytm Payments Bank, State Bank of India, Yes Bank, Axis Bank and ICICI Bank.
Worldline prepared the report after analyzing transactions available in public databases as well as transactions processed by the company during January – March 2022 period. It said in Q1 2022, as many as 9.36 billion transactions amounting to Rs10.25 trillion were processed through payment modes like debit and credit cards, prepaid payment instruments like mobile wallets and prepaid cards, and UPI Person to Merchant and UPI P2M transactions emerged as the most preferred payment mode among consumers with a market share of 64% in volume and 50% in terms of value.
However, the report also says credit cards accounted 7% of transactions but 26% of value and debit cards accounted for 10% of transactions but 18% in value.
TOP UPI APPS
The report adds that as of Q1 2022, the top UPI apps in terms of volume were PhonePe, Google Pay, Paytm Payments Bank app, Amazon Pay, Axis Bank’s app while top PSP UPI players were Yes Bank, Axis Bank, State Bank of India, HDFC Bank and Paytm Payments Bank. Among the top UPI apps, Phone Pe, Google Pay and Paytm accounted for 94.8% of UPI transactions volume and 93% of UPI transactions value as of March 2022. The Average Ticket Size (ATS) for UPI P2P transactions was Rs2455 and Rs860 for P2M transactions.
“With merchant adoption for UPI growing swiftly, the ATS of UPI P2M is witnessing a steady upward growth while ATS for P2P transactions is inching down but that is an effect of the volume of transactions as well as a move to P2M transactions. P2M transactions recorded a 24% increase in Q1 2022 as compared to Q1 2021. In Q1 2022, out of total UPI volumes, 56% transactions were P2P while 44% were P2M; in terms of value, P2M transactions generally contributed to about 19% of UPI transactions,” says the report.
POS TERMINALS TOO GROW
The report found that as of March 2022, the total number of POS terminals deployed by merchant acquiring banks were 6.07 million with over half a million POS terminals deployed during Q1 2022. POS deployment witnessed over 28% growth in Q1 2022 compared to a year before.
Private sector banks represented about 70% of the POS terminal market while public sector banks had a share of 22%, payments banks 7% and foreign banks 1%. Top POS deployers among the acquiring banks were HDFC Bank, Axis Bank, ICICI Bank, State Bank of India, RBL Bank, Paytm Payments Bank, IndusInd Bank and Union Bank of India. In terms of POS market share, Axis Bank and ICICI Bank witnessed a growth of over 68% and 52% respectively in Q1 2022.
The total number of Bharat QRs were 4.97 million, a 39% rise as compared to March 2021 while UPI QRs stood at 172.73 million, registering an increase of 87% as compared to March 2021.
According to the report, the frequently visited physical merchant categories like grocery stores, restaurants, clothing and apparel, pharmacy and medical, hotels, jewelry retail, specialty retail, household appliances and departmental stores together accounted for over 60% in terms of volume and about 58% in terms value of the transactions. In the online space, e-commerce (shopping for goods and services), gaming, utility and financial services contributed to over 85% transaction in terms of volume and 47% in terms of value.
TOP STATES, CITIES
The top 10 states and cities with the highest number of transactions at physical touch points for Worldline India were Maharashtra, Tamil Nadu, Karnataka, Andhra Pradesh, Kerala, Gujarat, Delhi, Uttar Pradesh, Telangana and West Bengal. Similarly, the top 10 were Hyderabad, Bengaluru, Chennai, Mumbai, Pune, Delhi, Kolkata, Coimbatore, Ahmedabad and Vadodara.
The report said the total number of credit and debit cards in circulation by end of Q1 2022 was 991.28 million. While the number of outstanding credit cards increased by 19% from 62.04 million in March 2021 to 73.6 million in March 2022, outstanding debit cards increased by only 2% from 898.20 million to 917.66 million during the same period. During Q2 2022, about 23 million debit cards were withdrawn from circulation.
TOP CARD ISSUERS
The top credit card issuing banks were HDFC Bank, SBI, ICICI Bank, Axis Bank and RBL Bank while the top debit card issuing banks were SBI, Band of Baroda, Union Bank of India, Canara Bank and Punjab National Bank. The volume and value of credit cards stood at 2.02 billion and Rs8.77 trillion respectively as of Q1 2022. The number of credit card transactions at POS accounted for 305.83 million while e-commerce was 302.13 million. In terms of value, it was Rs1040.03 billion at POS and Rs1770 billion at e-commerce via credit cards. The number of debit card transactions stood at 942.7 million and value at Rs1.81 trillion. Out of the total debit card volume, transactions at POS were 585.11 million and ecommerce 357.6 million. In terms of value, Rs1.15 trillion worth of transactions were processed at POS terminals and Rs667.23 billion at e-commerce sites.
USE OF CARDS TOO GROW
Worldline says the trend shows that consumers are getting more comfortable to make online purchases via credit cards for big ticket size transactions while debit cards are more frequently used for small ticket size purchases at physical touchpoints. Value added services like EMI, BNPL are enabling customers to opt for high value products and services using their cards.
MOBILE, INTERNET TRANSACTIONS
The report highlights that as of January 2022, there were about 658 million internet users and about 1.2 billion mobile subscribers in India. And in Q1 2022, consumers made 15.6 billion mobile based payments whereas net banking / internet browser-based transactions were over 1 billion.
In terms of value, Rs44.68 trillion was transacted through mobile while Rs163.53 trillion through the internet. The figures indicate that mobile payments have become widespread and being used for small ticket transactions while internet browsers are the preferred mode for traditional shopping from e-commerce platforms.
The report also analyzed National Electronic Toll Collection (NETC) and said NETC processed about 745 million transactions worth Rs113 billion were processed through NETC and the transaction volume increased by 49% while value increased by 41%.
