Launched in 2016, UPI crossed 1 billion transactions for the first time in October 2019. While it took UPI three years to reach a billion transactions in a month, the next billion came in just a year, indicating the increased adoption of UPI by consumers for peer-to-peer (P2P) payments and also for peer to merchant (P2M) transactions.
Digital payments, especially UPI, saw increased adoption in 2020 during the Covid-19 pandemic. Notwithstanding the blip in initial months of the pandemic, where transaction volume and value dipped, the recovery was fast and NPCI's payment platforms namely UPI, Immediate Payment Service (IMPS), and others recorded fresh highs in the following months aided by aversion towards cash usage as well as card usage by the general public.
Experts said the surge in UPI transactions
is because of increased consumer interest in making bill payments and recharging mobile phones online, and purchase of non-essential goods on e-commerce platforms. There has been a shift in the consumer mindset during the Covid-19 crisis and the subsequent lockdown, as they took to digital modes of payment even in sectors like education.
In its Payments and Settlement Systems in India booklet, the Reserve Bank of India (RBI) has said, UPI has grown to be the fastest payment system in the world with many jurisdictions eager to replicate the system. Given its popularity and acceptance, there are many innovations possible to extend UPI to desktop browsers, feature phones, offline payments as well as recurring payments.
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