NEW DELHI, Apr 3
Within the growing digital payments landscape of India, UPI has maintained its dominant position with the total number of UPI transactions registering a growth of 56 per cent on-year in H2 2023, with the volume being at 65.77 billion as against 42.09 billion in H2 2022, said a report by Worldline. The value of transactions during the same time period surged by 44 per cent from Rs 69.36 trillion to Rs 99.68 trillion.
In its India Digital Payments Report for H2 2023, Worldline said that the average ticket size (ATS) was at Rs 1515, down 8 per cent from Rs 1648. “The ATS persistently follows a downward trend, indicating a more profound integration of UPI, particularly in smaller or micro transactions. This decline is predominantly propelled by the surge in person-to-merchant (P2M) transactions,” the report stated.
Ramesh Narasimhan, Chief Executive Officer – India, Worldline, said, “The year 2023 witnessed some significant milestones in the payments ecosystem. UPI maintains its position as the uncontested frontrunner, buoyed by substantial expansion in mobile transactions. This trend underscores users’ growing confidence and familiarity with smartphone-based payment methods. The proliferation of Point of Sale terminals has reached unprecedented levels, concurrent with the ascendance of mobile payments as a dominant transaction avenue. This underscores the necessity for FinTechs to adjust to a diverse array of payment channels.” Hindustan Copper, metal industry, MIC production, ore production, flagship unit, growth, FY24 performance Metal stocks in focus: Hindustan Copper posts MIC production of 27,404 tonnes in FY24, highest in past 5 years
Between July 2022 and December 2023, there was a notable increase in the payment’s acceptance infrastructure channels, the report said. Point of Sale (PoS) terminals expanded by 26 per cent to reach 8.56 million. Private Sector Banks dominated the space with 73 per cent market share and Public Sector Banks accounted for 18 per cent. Payments and foreign banks have 8 per cent and 1 per cent market share respectively. Bharat QR (BQR) usage grew by 32 per cent to 5.96 million. The standout, as expected, is UPI QRs which grew by 57 per cent to 317 million.
Among the top PoS deployers are Axis Bank, ICICI Bank, HDFC Bank, State Bank Of India, RBL Bank, Paytm Payments Bank, IndusInd Bank, Kotak Mahindra Bank, Yes Bank, and Canara Bank, accounting for 94 per cent of terminals deployed as of December 2023.
Now, UPI transactions consist of either person-to-person (P2P) or person-to-merchant (P2M) transactions. Whileboth have clocked good growth numbers, per the details shared by the report, the growth in P2M transactions outdid the P2P.
P2M transactions witnessed a 77 per cent increase in volume, rising from 21.84 billion in H2 2022 to 38.73 billion in H2 2023. The value escalated from Rs 15.66 trillion during H2 2022 to Rs 25.43 trillion in H2 2023, posting a growth of 62 per cent YoY. P2P transactions surged 34 per cent on-year to reach 27.04 billion in H2 2023 as against 20.25 billion in H2 2022. Concurrently, the value of P2P transactions grew from Rs 53.69 trillion to Rs 74.24 trillion, reflecting a 38 per cent increase.
During H2 2023, the average ticket size of all UPI transactions was at Rs 1515 as against Rs 1648 in H2 2022, down 8 per cent on-year. For P2P transactions, the ATS saw a 4 per cent YoY growth. During the same period, the ATS of P2M transactions decreased by 9 per cent. “This gives a clear indication that reduction in overall ATS has been driven by P2M transactions which is a good trend as the future of UPI is P2M transactions,” it said.
In terms of volume and value, PhonePe, Google Pay and Paytm were the dominant UPI app players. In December 2023, the 3 apps accounted for 95.4 per cent of all the transactions in terms of volume which was 94.8 per cent in December 2022, while in terms of value they together comprised 93 per cent in December 2023.
Furthermore, the report stated that the total number of cards in circulation has shown a modest growth in the past one year. In December 2023, the total number of cards were 1.384 billion, up 6 per cent YoY. Credit cards witnessed the highest upsurge on-year basis with a growth of 21 per cent at 97.9 million. This was followed by Prepaid cards with a YoY growth of 13 per cent at 325 million and debit cards witnessed a minuscule growth of 2 per cent at 960.8million.
The top 5 issuers of credit cards were HDFC, SBI, ICICI, Axis and Kotak respectively and the top 5 issuers of debit cards were SBI, Bank of Baroda, Canara Bank, Union Bank of India and HDFC Bank. According to the Wordline report, 71 per cent of credit cards were issued by private sector banks and 24 per cent were by public sector banks while 65 per cent of debit cards were issued by public sector banks and 24 per cent by private sector banks. The balance was issued by payment banks, small finance banks and foreign banks.
The value of card transactions in H2 2023 was Rs 12.66 trillion, up 13 per cent from H2 2022, largely supported by credit cards. Credit card transactions value was Rs 9.39 trillion, reporting a growth of 11 per cent from H2 2022 while, during the same period, debit cards transaction value was Rs 3.02 trillion, down 16 per cent and prepaid cards were Rs 241 billion, down 30 per cent.
Meanwhile, the average ticket size (ATS) for all cards was Rs 2742, up 10 per cent YoY. This growth was primarily driven by debit card ATS growth. Credit cards ATS in H2 2023 was Rs 5276, up 8 per cent and prepaid cards ATS was Rs 310, down 28 pr cent and debit cards ATS was Rs 2642, up 24 per cent.
The total value of card transactions in H2 2023 for online purchases surged by 24 per cent to Rs 7.34 trillion compared to H2 2022. During the same period, the value of credit card transactions soared by 40 per cent to Rs 6.12 trillion, while debit card transactions decreased by 18 per cent to Rs 1.03 trillion, and prepaid card transactions dropped by 32 per cent to Rs 190 billion. This, Worldline said, indicates that UPI transactions are increasingly dominating other channels, both at Point of Sale (PoS) and online. However, credit card expenditures are rising due to heightened consumption of higher value goods and services.
Mobile payments, which are transactions done using mobile phone apps, have seen solid growth. The volume of mobile transactions in H2 2023 was 62.95 billion compared to 45.58 billion in H2 2022, a 38 per cent increase while the value of mobile transactions in H2 2023 was Rs 152.33 trillion compared to Rs 116 trillion in H2 2022, a 31 per cent increase.
Electronic Toll Collection (ETC) has today also extended to parking plazas and various other applications. The number of tags issued has grown from 55.94 million in July 2022 to 81.24 million in December 2023, up 45 per cent. In terms of volume, transaction in H2 2023 were 1.89 billion compared to 1.67 billion in H2 2022, up 13 per cent while the value of ETC transactions in H2 2023 was Rs 319.48 billion, up 20 per cent as compared to Rs 267 billion in H2 2022.
