UPI does 1.25 Bn transactions in March, amidst lockdown and Yes Bank woes

Unified Payments Interface  (UPI) has once again crossed the 1 billion transactions volume mark, recording 1.25 billion transactions worth Rs 2,06,462 crore or Rs 2.06 trillion in March.

Though this is a 6% decline in month-on-month volume as it registered 1.33 billion transactions amounting to Rs 2,22,517 crore or Rs 2.22 trillion in February.

However, it is commendable that it has managed to breach the billion mark again given the many challenges it faced in the month.

Experts say that the fall in March was mainly due to the nationwide lockdown imposed to counter the spread of Covid-19 where e-commerce, foodtech, grocery as well as other online platforms were forced to halt or reduce their operations and digital payments firms had to bear the cost.

Moreover, Yes Bank’s moratorium also had a large impact on UPI apps which were powered by the private sector lender. PhonePe, which is the top UPI app running on the Yes Bank handle, was the worst-hit platform due to the moratorium.

However, the announcement of the PM CARES Fund had a positive impact on the UPI-enabled payment apps as people preferred UPI over other payment modes available like net banking, NEFT and IMPS.

Google Pay, PhonePe and Paytm are the leading players in terms of market share in the UPI ecosystem. Interestingly, the trio also has been considered as the top apps in terms of bringing customers to their platform to donate to the COVID-19 relief fund.

While Paytm has set a target to contribute Rs 500 crore to the fund, Walmart-owned Flipkart has pledged to add Rs 100 crore. Both will also add an extra Rs 10 for every contribution from their users.