With transactions worth ₹126 lakh crore, UPI rules digital payments in 2022: Worldline report

• More than 74.05 billion transactions worth ₹126 lakh crore were processed through UPI in 2022.
• The increase in the usage of QR codes has led to a rise in UPI transactions, with the number of transactions via QR codes reaching 237 million in December 2022.
• Debit card transactions have shown a consistent decline throughout 2022, likely due to the increasing popularity of UPI transactions.

Indians are increasingly choosing to pay digitally with transactions via debit, credit, prepaid cards and UPI amounting to ₹149.5 lakh crore in value and 88 billion in volume in 2022, as per a Worldline report.

A lion’s share of these transactions occurred via UPI (Unified Payments Interface) – accounting for ₹126 lakh crore, over 74.05 billion transactions in 2022. UPI transactions grew 91% in volume and rose 76% in value over the year before.

“I am amazed every day to see the incredible progress we have made in the digital payments ecosystem over the past few years. The adoption of multiple payment solutions is a boon in our journey to realise the dream of a less-cash India,” said Ramesh Narasimhan, CEO, Worldline India.

The growth in UPI transactions was aided by growth in the ecosystem. The number of transactions via QR codes reached 237 million in December 2022 as compared to 152 million in January 2022.

Other payment options,like FASTag, Bharat Bill Pay and Aadhaar-enabled Payment System (AePS) also picked up in 2022, said the report named ‘India Digital Payments Annual Report'.

Debit down, credit up

The number of outstanding debit cards increased by a mere 0.2% to 939.4 million in 2022, as compared to the year before.

“Debit card transactions have shown a consistent decline throughout the year, likely due to the increasing popularity of UPI transactions,” the report said.

On the other hand, banks have increased the number of credit cards by 18% indicating an increased appetite for higher-ticket transactions.

“The volume and value of transactions done on credit cards has seen a steady uptick through the year. Credit card transactions in 2023 could benefit majorly as credit cards are now eligible for doing UPI transactions,” the report said.

Small & big transactions via UPI

At the end of 2022, 54% of UPI transactions volume was P2M (person-to- merchant transactions) whereas in terms of value it was 23%.

By December 2022, the average ticket size (ATS) for UPI person-to-person (P2P) transactions was ₹2,753, while the ATS for UPI person-to-merchant (P2M) transactions was ₹687.

“This signals the deep entrenchments of UPI P2M transactions; it is being used for large as well as very small transactions, the latter being the most difficult to move away from cash,” the report said.

PhonePe, Google Pay, Paytm Payments Bank App, Amazon Pay, and Axis Bank were the top 5 UPI apps in 2022, based on both transaction volume and value.

FASTag, Bharat Bill Pay & AePS payments on the rise

By the end of 2022, National Electronic Toll Collection (NETC) processed a total of 3.25 billion transactions worth ₹50,911 crore, representing a 31% increase in volume and a 37% increase in value over 2021. As of December 2022, a total of 36 banks were live with NETC FASTag.

In 2022, the Bharat Bill Payment Central Unit (BBPCU) processed a total of 985.7 million transactions with a total value of ₹1.70 lakh crore. This represents a growth rate of 75% in volume and 83% in value compared to the year 2021.

Also in 2022, the AePS recorded a significant volume of over 2.63 billion transactions with a total value of ₹3.42 lakh crore. This represents a growth rate of approximately 24% in volume and 20% in value compared to the year 2021.

AePS is a bank-led model that enables online interoperable financial inclusion transactions at point of sale (microATM) through the business correspondent of any bank using Aadhaar authentication.