Unified Payments Interface (UPI) has achieved a significant milestone, surpassing 10 billion merchant transactions in October, marking a 53% year-on-year growth. This surge in usage came at the height of the festive season sales, solidifying UPI as the dominant payment method in India.
The homegrown payment system continues to outperform credit cards and mobile wallets, reaffirming its status as the most preferred digital payments mode for merchants in the country.
According to data released by the National Payments Corporation of India (NPCI), UPI recorded a total of 16.5 billion transactions in October. This impressive growth was further highlighted on October 31, Diwali day, when UPI registered 644 million transactions, the highest ever for a single day, as per a report.
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While UPI led the charge, credit card transactions also saw a notable increase. In October, credit cards saw a 35% rise in merchant transactions, reaching 433 million, compared to around 320 million the previous year, according to the Reserve Bank of India (RBI).
On the other hand, debit cards showed a decline, with transactions dropping by 24%, totaling 144 million in October, down from 190 million in the same month last year. This decline in debit card usage is attributed to several factors, including the absence of debit card EMI options from major banks like HDFC Bank during this year’s festive season.
Mobile wallets, which once dominated the digital payments market, also continued their downward trend. October saw 442 million mobile wallet transactions, a 17% decrease from 533 million the previous year, according to RBI data. As UPI gains ground, mobile wallets seem to be losing their appeal among consumers.
Overall, while UPI continues its upward trajectory, both credit cards and mobile wallets face challenges in keeping pace with the rapidly evolving digital payment landscape.