UPI Transactions Jump 52% Fuelling India’s Digital Payment Boom

By Gloria Methri

In a remarkable surge reflecting the growing popularity of digital payments, Unified Payments Interface (UPI) transactions in India soared by 52% year-on-year, reaching 78.97 billion in the first half of 2024.

This growth, reported by Worldline, underscores UPI’s dominance in the digital payment ecosystem as it continues to expand its reach beyond India’s borders.

Dominance of UPI

The report details a significant leap in UPI transaction volume, climbing from 51.9 billion in the first half of 2023 to 78.97 billion in the same period in 2024. The corresponding value of these transactions surged by 40%, rising from INR 83.16 trillion to INR 116.63 trillion.

Such figures illustrate not only the sheer scale of UPI’s adoption but also its pivotal role in facilitating a wide range of financial activities, from microtransactions to larger purchases.

Ramesh Narasimhan, CEO of Worldline India, highlighted the report’s findings, saying, “The data illustrates the scale and speed at which digital payments are becoming part and parcel of everyday life across the country.” He noted that the rise of UPI, particularly in person-to-merchant (P2M) transactions, reaffirms its standing as the go-to method for microtransactions, further enhancing its long-term viability.

Shifts in Consumer Behavior

A deeper dive into consumer habits reveals intriguing trends. In physical retail, the most frequented merchant categories included grocery stores, restaurants, and service stations, accounting for 68% of transaction volume and nearly 53% of total transaction value. Online sectors like eCommerce, gaming, and financial services made up a hefty 81% of transaction volume.

Interestingly, the average ticket size (ATS) of UPI transactions saw a decline from INR 1,603 in the first half of 2023 to INR 1,478 in 2024. This 8% drop, particularly in person-to-merchant transactions, indicates that UPI is becoming increasingly popular for small, everyday purchases. Conversely, person-to-person (P2P) transactions experienced a slight increase in ATS, underscoring a balanced usage of UPI across different transaction types.

Expanding Infrastructure

Another notable trend is the significant expansion of payment infrastructure. The number of point-of-sale (POS) terminals deployed has now surpassed 8.96 million, facilitating seamless transactions for consumers and merchants alike. This infrastructure growth is critical for supporting the burgeoning digital payment ecosystem, ensuring that the benefits of UPI are accessible to a broader audience.

Future Outlook

The burgeoning use of UPI not only drives convenience but also promotes financial inclusion and economic participation. The report suggests that as UPI solidifies its presence, it could pave the way for more significant transactions in the future, reinforcing its status as a mainstay in India’s payment landscape.

Narasimhan concluded with optimism about the future, emphasising Worldline’s commitment to fostering a secure and efficient digital payment ecosystem that benefits both consumers and businesses. With the rapid adoption of digital payments, India stands on the brink of a significant economic evolution, one transaction at a time.