UPI Transactions Shows 500% Growth In Volume Of Payments: Report

According to PayNearby, value and volume of aided financial transactions across semi-urban and rural retail counters in India has increased by 25 per cent and 14 per cent.

This reflects a change in consumer behaviour as more people are choosing supported digital methods for their banking and lifestyle needs and integrating into the formal economy.

The increase rates were noticed across a number of PayNearby product categories, including the Unified Payments Interface (UPI), cash withdrawal, MSME credit, utility payment, cash management, aided ecommerce, and more. Citizens might get them at neighbourhood retail outlets like kirana stores, places to recharge mobile phones, pharmacies, customer service points (CSPs), and travel agencies, among others.

According to the survey, PayNearby retail counters showed a huge 650 per cent and 500 per cent growth in value and volume for Unified Payments Interface (UPI) transactions, respectively. This represents the expanding use of UPI outside of Tier II regions in the nation. This emphasises how important UPI may be in encouraging digital financial inclusion.

The information was provided as part of PayNearby's second publication of its pan-India report titled "Retail-O-Nomics." The analysis was created using data from over a million different retail touchpoints across the nation. The report's conclusions are based on company data gathered throughout a comparison period that runs from January to October 2022 in comparison to the same time in 2021.

The report notes that the demand for micro ATMs and mPOS devices has increased by over 25 per cent, and the mPOS business has grown by over 100 per cent. The increase in demand for digital payment methods at retail establishments highlights the crucial role that small retail enterprises play in closing the infrastructure gap and promoting financial inclusion at the last mile.

The value and volume of cash withdrawals through micro ATMs and AePS, which continue to be one of the main sources of income for semi-urban and rural digital counters, have grown by 8 and 9 per cent overall, respectively. 

In comparison to the same period last year, cash withdrawals from micro ATMs saw a 25 per cent increase in value and a 28 per cent increase in volume. This growth rate demonstrates the expanding role that this portable digital gadget is now playing in ensuring easy access to bank accounts, as well as assisting retailers in making better use of cash-at-store and increasing their revenue. The average cash withdrawal per transaction has, however, decreased somewhat from Rs 2620 in 2021 to Rs 2595 in 2022.

In addition, the report shows a rapid increase of more than 200 per cent in the cash collection business (including EMIs) with a monthly average of Rs 1400 crores, showing a rebound in demand for loans and other financing options from pre-pandemic levels.  Most cash collection procedures showed an increase in demand, including the collection from logistics and ecommerce businesses, which saw a volume increase of over 89 percent. During the survey period, insurance premiums at retail establishments also experienced a staggering 370 per cent surge and a 365 per cent increase in clients.

Anand Kumar Bajaj, Founder, MD & CEO, PayNearby, comments, “The findings in the report are inspiring and emphasise the fact that Bharat is gearing to walk hand-in-hand with India. Bharat is aspirational, and the increased offtake of green shoot services like assisted commerce, OTT subscription, micro-lending validates our commitment to make these services easily available at a store nearby. We have serviced close to Rs 70,000 crores of digital services in the first 10 months of this calendar year and the steady growth of cash withdrawal business, together with the fast track adoption of some of these green shoot services indicate a steady recovery of our economy post the devastating impact of the pandemic. We will continue to strengthen our efforts to simplify high end technology, so that most services can be democratised and made available to all through our well entrenched Distribution-as-a-Service network. It is also heartening to see an accelerated demand within the retail community to make assisted financial transactions available at a store nearby. This is not only a great income generator for the merchant, but also helps build the nation grounds up and bridge the gap between Bharat and India. PayNearby, Zidd Aage Badhne Ki.”

Online gaming, online education, and other subscription-based digital services have all experienced growth. Despite the small numbers, they confirm a hidden need for such services and the rising popularity of digital goods in a post-pandemic Bharat.

Local stores' bill payment services saw a 12 per cent value and 10 per cent volume growth. Over the previous year, mobile recharges increased by 18 per cent.  In comparison to the same period last year, travel bookings increased by 8 per cent for flights and 6 per cent for trains over the festival season, primarily as a result of people visiting friends and family who were attending the event in their home countries. The report also notes an 88 per cent increase in Pan Card issuance from one quarter to the next.

A 263 per cent increase in microcredit for MSMEs during this time period also shows that there is a significant unmet need for credit in this market that must be met for India to go to the next stage of development.

Another intriguing finding was that 32 per cent of banking transactions took place between 6 p.m. and 12 a.m. during non-banking hours. This emphasises how important retail establishments are to meeting the requirements of the general public in terms of banking and technology.