UPI clocks over 17.4 bn transactions worth ₹30.4 tn in Q2 2022

In Q2 2022, 20.57 billion transactions in volume and ₹36.08 trillion in terms of value was processed through Debit and Credit cards, Prepaid Payment Instruments like mobile wallets and prepaid cards, and UPI which includes P2M (person to merchant) and P2P (person to person) transactions, according to the report issued by Worldline India - the ‘India Digital Payments Report’ for Q2 2022.

The report highlights the analysis of the transactions available in public databases as well as processed by Worldline India in the second quarter (April – June 2022) and derived some unique insights.

UPI P2P accounted for 49% in volume and 67% in value but in terms of merchants transactions, UPI P2M emerged as the preferred payment mode with a market share of 34% in volume and 17% in terms of value. Payments through credit and debit cards accounted for 8% in volume and 14% in value. While UPI remains a dominant payment mode, adoption of credit cards is growing at a healthy pace it remains the preferred mode for high ticket size transactions.

Ramesh Narasimhan, Chief Executive Officer – India, Worldline, said, “2022 is another momentous year for the payments space in India. We are successfully sailing through the aftermath of Covid-19, the total cards in circulation has breached 1 billion mark, UPI is tracking over 6 billion transactions per month, about 53 million FASTags have been issued, and over 20k billers are live on Bharat BillPay ecosystem.

This demonstrate a robust payment’s ecosystem which is built to serve the diverse and growing needs of Bharat. We are glad to share our India Digital Payments Report Q2 2022 which captures key trends in the payment world and showcasing a double-digit growth across almost all payment platforms. We also highlights our view on what the RBI’s Vision 2025 means for Digital Payments in India.”

Unified Payment Interface (UPI)

In Q2 2022, UPI clocked over 17.4 billion transactions in volume and ₹30.4 trillion in terms of value. Transactions volume and value have seen an increase about 118% increase in volume and over 98% increase in value in Q2 2022 as compared to Q2 2021.

In Q2 2022, the top remitter banks were State Bank of India, HDFC Bank, Bank of Baroda, Union Bank and ICICI Bank. The top beneficiary banks were Paytm Payments Bank, Yes Bank, SBI, Axis Bank and ICICI Bank.

However, it should be noted that most transactions are being driven by Third-Party applications riding on the rails of these banks; in Q2 2022, the top UPI Apps in terms of volume were PhonePe, Google Pay, Paytm.

The Average Ticket Size (ATS) for UPI P2P transactions was ₹2,425 and for UPI P2M transaction was ₹820 as of June 2022.

UPI was launched in April 2016 with 21 partner banks and as of now, the number has increased to 346 banks are part of the UPI ecosystem. It is now accepted in countries like UAE, Singapore, France and Bhutan.

What could be a game-changer for UPI transactions will be linking credit cards on to the platform – it is currently only Rupay but could increase going forward – and this could further supercharge UPI transactions, especially in terms of P2M average ticket sizes.

The government has also reiterated that UPI is a public good and that it is not considering levying any charges for UPI services. Companies have sought access to UPI data, says RBI Deputy Governor. As of June 2022, total number of UPI QRs stood at 195.17 million, an increase of 92% compared to June 2021.

Merchant Acquiring

As of June 2022, the total number of POS terminals deployed by merchant acquiring banks was 6.59 million; it increased by 43% growth in Q2 2022 compared to Q2 2021.

Overall, private sector banks represented about 74% of the POS terminal market while public sector banks accounted for 18%. Payments banks accounted for 7% market share and foreign banks continue to represent a 1% share.

Top POS deployers: HDFC Bank, Axis Bank, ICICI Bank, State Bank of India, RBL Bank, Paytm Payments Bank, IndusInd Bank, Kotak Bank, Yes Bank, Canara Bank are the top acquiring banks with significant market share in terms of POS deployment.

Worldline In India Insights

In Q2 2022, frequently visited physical merchant categories like grocery stores, restaurants, clothing and apparel, pharmacy and medical, hotels, jewellery retail, specialty retail, household appliances and departmental stores together accounted for over 61% in terms of volume and about 58% in terms value.

In the online space, e-commerce (shopping for goods and services), gaming, utility and financial services contributed to over 86% transaction in terms of volume and 47% in terms of value.

Education, Travel, Hospitality & Government sector contributed remaining 14% transactions in terms of volume & 53% in terms of value.

States and cities with the highest number of transactions at physical touch points in Q2 2022 for Worldline India are –

Top 10 states: 1. Maharashtra 2. Tamil Nadu 3. Karnataka 4. Andhra Pradesh 5. Kerala 6. Gujarat 7. Delhi 8. Uttar Pradesh 9. Telangana 10. West Bengal

Top 10 cities: 1. Hyderabad 2. Bengaluru 3. Chennai 4. Mumbai 5. Pune 6. Delhi 7. Kolkata 8. Coimbatore 9. Ahmedabad 10. Vadodara