The Reserve Bank of India (RBI) showered accolades on the Unified Payments Interface (UPI) in its November bulletin, highlighting the groundbreaking achievement of surpassing 1.1 billion transactions in October 2023. Clocking an additional 100 crore transactions in just two months, the UPI’s rapid ascent underscores its pivotal role in India’s digital payments landscape.
The October Surge:
In its monthly bulletin, the RBI underscored the remarkable feat of the UPI, which witnessed a surge of 100 crore transactions to reach an impressive 1.1 billion in October 2023. This milestone follows closely on the heels of the UPI achieving the 1 billion transaction mark in August of the same year, showcasing its exponential growth trajectory.
Festive Boost and NPCI’s Strategy:
The RBI attributed this remarkable achievement to the festive season, citing it as a catalyst for the robust expansion of the digital payments ecosystem. The National Payments Corporation of India (NPCI) received commendation for orchestrating this achievement, aligning with its strategy to escalate monthly transactions to an ambitious 10 billion.
IPO Facilitation and Digital Payment Landscape:
The central bank also spotlighted the doubling of mandates for the Initial Public Offering (IPO) facility through the UPI in October 2023 compared to the previous year. Furthermore, the bulletin acknowledged the continuous rise of credit cards, buoyed by features such as cashback, reward points, contactless cards, and UPI-linked credit cards. The extension of the Bharat Bill Payment System (BBPS) to B2B clients was predicted to fortify digital payments in India.
Regulatory Initiatives and Innovation:
The RBI outlined its commitment to streamlining the digital payments landscape and fostering innovation. Noteworthy steps include introducing the fifth cohort under the regulatory sandbox, maintaining a theme-neutral approach. The successful exit of entities from the third sandbox cohort focused on ‘MSME Lending’ exemplifies the effectiveness of these initiatives.
Future Trajectory and Global Expansion:
Anticipating a significant reduction in cash reliance, the bulletin highlighted the apex bank’s anticipation of growth in the digital payments sector, primarily in C2B (consumer-to-business) payments, followed by consumer-to-consumer and B2B transactions. The exponential growth aligns with NPCI’s strategy to hit 10 billion monthly transactions.
The global influence of UPI was evident, with its introduction in countries like France, Bhutan, Nepal, UAE, and Canada. Ongoing discussions hint at its potential expansion to New Zealand, South American nations, and African countries.
