9.36 billion digital payments transactions worth ₹10.25 trillion processed in Q1: Report

A Worldline report has revealed that during January-March 2022 period, 9.36 billion transactions amounting to ₹10.25 trillion were processed via payment modes such as debit and credit cards, prepaid payment instruments like mobile wallets and prepaid cards, and UPI person to merchant (P2M).

The report also highlighted that 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, during the quarter.

“This is not altogether surprising given the growth of UPI. However, two points of note. Credit cards accounted 7% of transactions but 26% of value, indicating that customers still prefer to use their credit cards for high-value transactions. Debit cards accounted for 10% of transactions but 18% in value – the volume and volume has shrunk from previous years and is likely because of the rise of UPI,” the report said. 

The rise of UPI

During the quarter, UPI clocked over 14.55 billion transactions in volume and ₹26.19 trillion in terms of value.

According to the report, its transactions volume and value has almost doubled since last year recording about 99% increase in volume and over 90% increase in value compared to Q1 2021.

In Q1 2022, 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.

Further, the top UPI apps in terms of volume were PhonePe, Google Pay, Paytm Payments Bank App, Amazon Pay, Axis banks App while top PSP (Payment service provider) 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.

Card issuance 

According to Worldline ‘India Digital Payments Report’ Q1 2022, the total number of credit and debit cards in circulation by end of March 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.

Notably, during Q2 2022, about 23 million debit cards were withdrawn from circulation which could possibly be a correction in reported numbers by banks or the closure of inactive accounts.

In terms of credit cards, their volume and value stood at 2.02 billion and ₹8.77 trillion, respectively. The number of credit card transactions at POS accounted for 305.83 million while e-commerce was 302.13 million.

In terms of value, consumers transacted ₹1,040.03 billion at POS and ₹1,770 billion at ecommerce via credit cards in Q1 2022. 

In Q1 2022, debit card transactions volume and value stood at 942.7 million and ₹1.81 trillion, respectively.

India Insights

The report also showed that in Q1 2022, frequently visited physical merchant categories such as grocery stores, restaurants, clothing and apparel, pharmacy and medical, hotels, jewellery retail, specialty retail, household appliances and departmental stores together accounted for over 60% in terms of volume and about 58% in terms value.

Further, in the online space, e-commerce (shopping for goods and services), gaming, utility & financial services contributed to over 85% transaction in terms of volume and 47% in terms of value.

The top five states in terms of the highest number of transactions at physical touch points were, Maharashtra, Tamil Nadu, Karnataka, Andhra Pradesh, and Kerala.

On the other hand, the top cities were, Hyderabad, Bengaluru, Chennai, Mumbai and Pune.