Digital payment volumes on NPCI channels rebound in May

MUMBAI: Digital payments volumes recorded on major National Payments Corporation of India operated channels rebounded in May after the volumes had plummeted in April when the nationwide lockdown to control the spread of the coronavirus pandemic had caused the economy to come at a near standstill.
Transaction volumes recorded on channels such as Unified Payments Interface (UPI), Immediate Payment System (IMPS), Bharat Bill Payment System and National Electronic Toll Collection (NETC) inched towards pre-covid levels signifying a slow revival in commercial activities and early signs of consumer appetite to spend.

Experts suggest that the revival of volumes could be on the back of graded reopening of commerce, including e-commerce services, and improved adoption of digital payments by consumers.

Data released by NPCI on its social media handles showed a total of 123 crore transactions worth Rs.2.18 lakh crore processed on UPI in May; up 24% in volumes and 45% in value from the transactions processed in April. In March, a total of 125 crore transactions worth Rs.2.06 lakh crore was recorded on the popular payment service.

“The overall digital transactions in our country had also dropped during lockdown, primarily due to restrictions imposed on non-essential sectors and people having to stay indoors and not having enough spending power,” said Harshil Mathur, CEO Razorpay. “But now, with the situation starting to slightly ease out in parts of the country, we are seeing a spike in transactions in the last few days, particularly in e-commerce.”

Similarly, IMPS also recorded a rebound in transaction volumes and value. A total of 16.6 crore transactions worth Rs.1.69 lakh crore was processed in May on the channel used for bank to bank transfer of bigger ticket size funds. This is about 36% growth in both volume and value of transactions recorded on the channel from April.

Interestingly the channel that recorded sharpest revival in volumes was NETC-powered Fastag. With graded opening of highways, the contactless toll payment service recorded five-fold monthly jump in volume and value recording 5.5 crore transactions worth Rs.1142 crore in May. Transactions had plummeted nearly eight times in April as against March.

Online bill payment system BBPS too recorded a healthy revival in numbers. Users paid a total of 1.6 crore bills worth Rs.2178 crore through the service in May, up 30% in volume and 60% increase in value of transactions from April.