Tag: digital payments

NPCI curates financial literacy book for CBSE students, BFSI News, ET BFSI

Personal Finance

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The National Payments Corporation of India (NPCI) and the Central Board of Secondary Education (CBSE) have collaborated to develop a financial literacy curriculum for Class VI students. The Financial Literacy Textbook is being released as part of a new elective ‘financial literacy’ course that will allow students to grasp basic financial concepts at an early stage of their education.

The textbook covers a wide range of topics related to financial awareness, including teamwork and basic financial principles, as well as Banking, Security, and Digital Payments such as UPI, Cards, Wallets, and more. It covers the history of banking, the change from coins to paper money, the different types of banks, and the primary operations and services that banks provide. The textbook also elucidates the significant role of RBI and GOI in providing an impetus to the Digital Payments movement.

This book covers everything a child might need to know later in life, from basic ideas like cash, banking, savings, and investments .

This book covers everything a child might need to know later in life, from basic ideas like cash, banking, savings, and investments to advanced concepts like IMPS, UPI, USSD, NACH, PoS, mPoS, QR Codes, and ATMs. The book elaborates on the role of UIDAI and the importance of Aadhaar, as well as the Aadhaar Enabled Payment System (AePS), in the context of digital payment options.

NPCI has also been working for course content development with CBSE for Standard 7 and 8.

Praveena Rai, COO, NPCI said, “We are excited to collaborate with CBSE to launch financial literacy curriculum for the students. We are confident that the financial literacy textbook will help tender minds absorb basic & advanced financial concepts with ease and will establish mindful financial conduct and sound decisions for the generations to come.”

Shri Manoj Ahuja, IAS, Chairman, CBSE said “As the new education policy emphasizes the need of nurturing a digital mindset among the students this book is the first step towards addressing the same. It focuses on the overall digital payment system which is new; this small module on financial literacy is going to educate our students on finance from an early age.”



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PayU, BFSI News, ET BFSI

Personal Finance

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PayU Insights report highlights the key sectors that have been illuminated in lockdown 1.0, pre lockdown 2.0 and lockdown 2.0. Online donations, charitable causes and logistics marches sky-high beat, others remained mere props in their performance. Entertainment and gaming could be quoted in this instance.

There has been a 52 percent increase in transaction volume and a 76 percent increase in expenditure year over year (May 2020 vs. May 2021). There was a 10% rise in the number of transactions after lockdown 2021 compared to pre-lockdown months, and a 21% decrease in average ticket size, demonstrating that customers are adopting online payments even for smaller transactions.

UPI continues to be the headliner, with number of transactions increased by 320% and expenditure increased by 306% in lockdown 2.0. Key insights of the report are as follows:

Online donations to charitable causes

Digital payments for charitable causes were able to get a good growth on the transactions by a massive 731% and expenditure by 2308% in lockdown 1.0. The lockdown 2.0 provides powerful forensic evidence in the record by distending the transactions and expenditure increased by 575% and 476% respectively. Within this category, various NGOs encapsulated activities to raise funds for covid relief.

Logistics hiked with partial and staggered lockdowns

Logistics sector nourished the undeviating growth in both transactions and expenditure with 217% and 227% respectively in lockdown 2.0 with a comparison of ventures as in lockdown 1.0. The utilisation of courier delivery service and purchase and transfer of essential items added proactive grounds to logistics. Further as per the bill passed in budget 2021, the scheme attempt to upsurge the digital payments.

Digital payment activities of Entertainment and gaming demoted

These sectors perceived degrowth. Transactions and expenditure took a major toll in the entertainment sector, hence down turning the activities in lockdown 2.0 by 35% and 41% respectively.

Likewise, the gaming sector too showed a turnaround in trends, declining by 63% compared to pre lockdown months.

The inflated sense of fall could be highlighted on the notion of consumers shifting from non-essential and muting of sentiments in this phase.

Travelling

The aftermath of lockdown 1.0 and 2.0 on travelling magnify the transactions and expenditures by 186% and 125% respectively. The relaxation in staggered lockdown navigated the travelling activities. But immediate lockdown downplayed the experience of transactions by 65% and by 78% in expenditure

UPI Growth

Lockdown 2.0 recorded phenomenal growth for UPI as a payment mode. The number of transactions through UPI increased by 320% and expenditure increased by 306% in lockdown 2.0, compared to lockdown 1.0. The next highest growth in modes of payment was observed in credit card transactions, as the number of transactions increased by 87% and expenditure increased by 69% year on year. For net banking and debit card modes, the number of transactions grew by 12% and 6% respectively year on year.

Pharmacy

The online digital payment transactions and expenditures harped by 78% and 31% respectively in lockdown 2021 compared to pre lockdown months. 9% decrease in transactions and 22% decrease in expenditures was witnessed with every succeeding month.

Retail and e-commerce

The analogy of lockdown 1.0 and 2.0 on account of transactions and expenditure in retail and e-commerce was seen as 171% growth in transactions and 108% in expenditure.

Education

Lockdown 2.0 anticipated expenditures to a growth rate of 37% whereas the transactions slipped by 31% as compared to lockdown 1.0.

Recharge and utility payments

The transactions and expenditures inched by 68% and 11% respectively in lockdown 2.0 compared to pre lockdown.

Groceries

Year on year, number of transactions grew by 171% with 108% growth in expenditure. There was a 52% increase in the number of transactions post lockdown 2.0 compared to pre lockdown months in 2021.

Hemang Dattani, Head–Data Intelligence, PayU said “Broadly, businesses and consumers were better prepared to deal with the exigencies of lockdown in 2021. Given that the lockdown was staggered and geographically restricted, the growth of digital payments has been steady, especially for sectors like retail, logistics & pharma.’’



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FIS, BFSI News, ET BFSI

Banking & Finance

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As the Covid-19 pandemic accelerated the adoption of digital payments in India, 68 percent of Indian consumers surveyed by FIS are now using online or mobile banking applications to transact.

A survey conducted by FIS between June 2020 and April 2021 looks at how the pandemic has impacted the consumer behavior on how they transact and found that there’s a significant shift on digital payments uptake where 94 percent of GenZ users own mobile wallets.

A similar surge is seen in the Buy Now, Pay Later (BNPL) during the pandemic, especially among younger generations. On an average, 32 percent of consumers own a BNPL app, and most often consumers use Amazon or Flipkart’s BNPL option.

Bharat Panchal, Chief Risk Officer, APMEA, FIS said: “The pandemic has led India to a new phase of digital payments adoption. To be successful, it’s vital that the banking sector provides technology-centric strategies which meet the diverse preferences of consumers’ rapidly changing habits, while also driving financial inclusion for underserved communities around the country.”

The report also points out that as the usage increases there has been an increase in financial frauds during the pandemic where consumers increasingly become more vulnerable. Around 34 percent of people surveyed have reported financial frauds in the past 12 months.

The fraud number rises to 41 percent among Gen Y and financial frauds were mostly related through phishing, QR code/UPI scams and card scams too.



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LIC Cards launches RuPay Prepaid Gift Card ‘Shagun’ Powered by IDBI Bank, BFSI News, ET BFSI

Banking & Finance

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A contactless prepaid Gift Card – ‘Shagun’ has been launched by LIC Cards Services Limited (LIC CSL) in collaboration with IDBI Bank on the RuPay platform with intent to promote cashless ways of gifting and present a wide range of end-use choices. It also presents itself as a future foray into the market of e-Gift Cards.

“We are delighted to partner with IDBI Bank and RuPay for the launch of LIC Gift Card powered by IDBI Bank on RuPay Platform. We believe that gifting is one of the biggest social interactions and social events in our society. We aim to enhance the value of digital transactions by providing a variety of benefits/cards thereby saving time and cost of transactions for both Gift Card buyer and recipient. LIC CSL has a vision to be the top Brand in Cards and Digital Payments, catering to all segments with geographical spread across the Country.” a spokesperson of LIC Cards Services Limited (LIC CSL) stated.

Shagun Gift card can be used at millions of merchant outlets and e-commerce websites in India to diversify spending options on the card. The card will provide users the freedom to make purchases at various merchant locations including departmental stores, petrol pumps, restaurants, jewelry stores, apparel stores, etc. They can also shop online, pay utility bills, book tickets for air, rail, bus, and so on through various mobile wallets and E-commerce portals or Apps using this card.

“In continuum with our on-going business synergies with LIC, we are glad to also have NPCI and LIC Cards Services Ltd as partners on-board for this initiative. This product has been curated keeping in mind the distinct privileges for the cardholders as well as the convenience of the contactless payment feature.” added Rakesh Sharma, MD & CEO, IDBI Bank.

“We look forward to continued collaboration with LIC CSL and IDBI Bank to take this product to the masses in coming months and further strengthen our customer base.” said Dilip Asbe, MD & CEO, NPCI.



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Covid-19 pandemic fuelled digital payments modes: RBI Annual Report

Banking & Finance

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The Covid-19 pandemic fuelled the proliferation of digital modes of payments, the Reserve Bank of India noted in its Annual Report 2020-21. The prospects for FinTech in India’s financial system in 2021-22 will depend upon the degree of entrenchment of digital usage, it further said.

“The Covid-19 pandemic has fast-tracked digital transformation of the payments ecosystem in India. Besides augmenting the broad-based use of technology, the pandemic has fuelled the proliferation of digital modes of payment, propelling the country towards ‘less-cash’ alternatives,” the report said.

Overall, the total digital transaction volume in 2020-21 stood at 4,371 crore, as against 3,412 crore in 2019-20, attesting to the resilience of the digital payment system in the face of the pandemic.

Future of fintech

The report noted that the prospects for FinTech in India’s financial system in 2021-22 will depend upon the degree of entrenchment of digital usage, which is, in turn, contingent upon the resilience of the underlying acceptance infrastructure, financial literacy and awareness of the users and strengthening of the customer protection and cyber security protocols in place.

Also read: Demand for cash surged in 2020-21 due to Covid-19 pandemic: RBI Annual Report

“All these factors will help in cementing the trust of users in digital modes,” it said.

The RBI’s initiative to set up a pan-India new Umbrella Entity will intensify competition in the digital space and bring out the best for end users and other participants in terms of efficiency gains and convenience, the report further said.

“Collaborations between card issuing banks, FinTech players and other stakeholders of the payments ecosystem are likely to give rise to a new hybrid model of finance that will help address credit gaps and ramp up last mile outreach by leveraging on the geographical footprint of banks and technological know-how of FinTech companies,” it noted.

In the area of digital payments, various initiatives such as an innovation hub, a regulatory sandbox and offline payment solutions are underway to ensure that in the digital ecosystem, India maintains its position as a leader.

The RBI is also in the process of extending the geo-tagging framework put in place to capture location of bank branches, ATMs and BCs to cover payment system touch points, enabling accurate capture of their location across the country. Further, the possibility of leveraging India’s domestic payment systems to facilitate cross-border transactions is being explored, and corridors and charges for inward remittances will be reviewed.

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Digital payments slow down in April as virus transmission accelerates, BFSI News, ET BFSI

Banking & Finance

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The slowdown in the economic activity due to lockdowns and restrictions in April echoed in the digital payment transactions in April.

The growth of digital payments slowed in April over March, remained higher than in February, according to a report.

The Unified Payments Interface (UPI) transactions dropped from the Rs 5­lakh crore peak in March to Rs 4.93 lakh crore via 264 crore transactions.

The Immediate Payment Service (IMPS) saw 32.29 crore transactions worth Rs 2.99­lakh crore in April as against 36.31 crore transactions of Rs 3.27 lakh crore in March.

Bharat Bill pay platform processed 3.51 crore transactions worth ₹Rs 5,201.92 crore in April as against 3.52 crore payments amounting to Rs 5,195.76 crore in March.

As the movement of people and goods slowed, the FASTags, AePS transactions through the NETC saw a sharp decline in April at 16.43 crore transactions worth Rs 2,776.9 crore. It was 19.32 crore transactions worth Rs 3,086.32 crore in March.

The Aadhaar enabled Payment System saw 7.42 crore transactions valued at Rs 22,139.05 crore in April as against 7.78 crore payments worth Rs 22,697.82 crore in March.

Last fiscal

UPI transaction volumes surged 43.2% in the first quarter of the last fiscal, 98.5% in the second quarter 104.6% in the third and 112.5% in the fourth quarter.

While IMPS volumes degrew 9.6% in Q1, they rose 26% om Q2. 40.5% in the third quarter and 42.9% in the fourth quarter.

National Automated Clearing House (NACH) volumes grew 32.8 in the first quarter, 13 in second, 0.9 in third while they degrew 10.2 in the fourth.

BBPS volumes grew 66% in Q1, 103.2 in Q2, 84.4 in Q3 and 102.7 in Q4 while National Electronic Toll Collection, the NHAI’s Fastag system logged 83.9 growth in Q1, 249.2 in Q2, 195 in Q3 and 75.3 in the fourth quarter.

On the other hand, RTGS volumes degrew 26.2 in Q1, logged 3.1 in Q2, 10.2 in third and 31.1 in the fourth quarter.

NEFT volumes degrew 3.9% in the first quarter, grew 9.8 in second, 23.2 in third, 17.8 in the fourth quarter.



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Digital payments see muted growth in April

Banking & Finance

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The growth of digital transactions eased in April at a time of localised lockdowns in several states amidst surging Covid-19 cases. The volume and value of transactions however, remained higher than that in February.

According to data released by the National Payments Corporation of India on Saturday, transactions on the Unified Payments Interface (UPI) in April scaled down from the ₹5 lakh crore peak it had touched in March.

As many as 264 crore transactions worth ₹4.93 lakh crore were processed on UPI in April 2021 versus 273 crore payments amounting to ₹5.04 lakh crore in March this year.

Similarly, the Immediate Payment Service (IMPS) processed 32.29 crore transactions worth ₹2.99 lakh crore in April. In contrast, there were 36.31 crore transactions of ₹3.27 lakh crore on the IMPS platform in March.

The transaction value on Bharat BillPay increased in April even though the volume fell marginally compared to March. It processed 3.51 crore transactions worth ₹5,201.92 crore in April as against 3.52 crore payments amounting to ₹5,195.76 crore in March.

Transactions through NETC FASTags saw a sharp decline in last month indicating lower movement of people and goods on highways. It processed 16.43 crore transactions worth ₹2,776.9 crore in April. In March, it had processed 19.32 crore transactions amounting to ₹3,086.32 crore.

Even the Aadhaar enabled Payment System registered muted transactions in April. It processed 7.42 crore transactions valued at ₹22,139.05 crore last month as against 7.78 crore payments worth ₹22,697.82 crore in March.

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How pandemic ushered in payments revolution in India, BFSI News, ET BFSI

Banking & Finance

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They may not be of big value, but many swipes have helped usher in a retail payments revolution right amid the pandemic.

While there has been a slowdown in the wholesale transaction value, the volumes have grown huge. A similar surge was seen in the immediate aftermath of the demonetisation of high-value notes in 2016.

Transactions through National Electronic Funds Transfer (NEFT), National Electronic Toll Collection (NETC), and the Bharat Bill Payment System (BBPS) grew robustly in fiscal 2021 over the previous year. Retail payment platforms such as Unified Payments Interface (UPI), Immediate Payment Service (IMPS), and National Automated Clearing House (NACH) saw a near doubling of both transaction volume from 12.5 billion to 22.3 billion, and value from Rs 21.3 lakh crore to Rs 41 lakh crore.

Volumes galore

UPI transaction volumes surged 43.2% in the first quarter of the last fiscal, 98.5% in the second quarter 104.6% in the third and 112.5% in the fourth quarter.

While IMPS volumes degrew 9.6% in Q1, they rose 26% om Q2. 40.5% in third quarter and 42.9% in the fourth quarter.

National Automated Clearing House (NACH) volumes grew 32.8 in the first quarter, 13 in second, 0.9 in third while they degrew 10.2 in the fourth.

BBPS volumes grew 66% in Q1, 103.2 in Q2, 84.4 in Q3 and 102.7 in Q4 while National Electronic Toll Collection, the NHAI’s Fastag system logged 83.9 growth in Q1, 249.2 in Q2, 195 in Q3 and 75.3 in the fourth quarter.

On the other hand, RTGS volumes degrew 26.2 in Q1, logged 3.1 in Q2, 10.2 in third and 31.1 in the fourth quarter.

NEFT volumes degrew 3.9% in the first quarter, grew 9.8 in second, 23.2 in third, 17.8 in the fourth quarter.

Value wise

UPI transactions scored an impressive growth value-wise too with the first quarter seeing 43.2% growth, the second 98.5%, the third 104.6% and the fourth 112.5%.

IMPS degrew 4.8 in Q1 but picked up in the second quarter with 27.9% growth, 34.6% in Q3 and 40.6% in the fourth quarter.

NACH transactions grew 20.4% value-wise in the first quarter, 10.3 in Q2, 6.8 in Q3, 1.3 in Q4.

BBPS logged 62.4% growth in the first quarter, 108.9% in the second, 83.5% in the third and 131.9% in the fourth quarter.

NETC transactions valuewise grew 61.4% in Q1, 181% in Q2, 139.3% in Q3, 66.2% in Q4.

On the other hand, RTGS transactions’ value degrew for the entire fiscal, falling 37.9 in the first quarter, 28.6% in the second, 7.7% in Q3 and 2.9% in the fourth quarter.

NEFT degrew 20.9% in the first quarter but grew 12.4% in second, 26.6% in third and 15.4% in the fourth quarter.

After demonetisation

RBI data shows a spurt in digital transactions immediately after demonetisation. Transactions through debit card at point of sale terminals and m-wallets increased by 134% and 163%, respectively, between October 2016 and December 2016.



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SBI and NPCI tie-up to push UPI adoption on YONO, BFSI News, ET BFSI

Personal Finance

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The State Bank of India (SBI), country’s largest lender and The National Payments Corporation of India (NPCI), umbrella body of retail and digital payments have joined hands to launch a dedicated campaign to focus on deepening the reach of UPI transactions across all sections of the population.

This joint initiative aims at encouraging users of SBI’s banking and lifestyle platform YONO to opt for UPI payments. Apart from this, the campaign will also help in educating them about UPI’s benefits so that there are more and more UPI users in the ecosystem.

Ravindra Pandey, Strategy & Chief Digital Officer, SBI said, “UPI has been witnessing a strong month-on-month growth which is a testament of customers’ willingness to adopt digital payments. In this FY, the YONO platform recorded 5.30 million transactions worth Rs. 2086 crore. UPI is currently one of the most preferred digital payment modes in India with around 207 banks linked to it and SBI was leading the segment with 664.75 million transactions, as of January 2021.”

YONO has observed 34 lakh UPI registrations since its inception in 2017, with over 62.5 lakh transactions worth more than Rs. 2,520 crore at current daily average of nearly 27,000 transactions (in last 30 days).

Praveena Rai, COO, NPCI said, “We are pleased to partner with SBI to strengthen the digital payments ecosystem by promoting UPI awareness among YONO users. Customers just need to know their UPI ID and use it so they can enjoy the convenience of making or receiving payment from their YONO app to any other bank or payment app.”



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Digital payments: India pips China, US, others in 2020; leads global tally with this many transactions

Banking & Finance

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UPI transaction value witnessed a growth of 18.7 per cent month-on-month to Rs 5.05 lakh crore in March 2021 from Rs 4.25 lakh crore in February 2021.

Amid Covid, India was home to the highest number of real-time online transactions in 2020 ahead of countries such as China and the US. 25.5 billion real-time payments transactions were processed in the country followed by 15.7 billion in China, 6 billion in South Korea, 5.2 billion in Thailand, and 2.8 billion in the UK. Among the top 10 countries, the US was ranked ninth with 1.2 billion transactions. The transaction volume share for instant payments India, among real-time transactions, was 15.6 per cent and 22.9 per cent for other electronic payments in 2020, according to a report by the UK-based payments system company ACI Worldwide. Importantly, paper-based payments continued to have a considerable share of 61.4 percent in India.

However, this is expected to change by 2025 as volume shares for instant payments and other electronic payments are likely to grow to 37.1 per cent and 34.6 per cent respectively. Consequently, the share of paper-based transactions would contract to 28.3 per cent. Moreover, the share of real-time payments volume in overall electronic transactions will exceed 50 per cent by 2024. “India’s journey of creating a digital financial infrastructure has been characterized by collaboration between the government, the regulator, banks, and fintechs. This has helped to advance the country’s goal of enabling financial inclusion and also provided rapid payments digitization for citizens,” said Kaushik Roy, VP and head of product management, Asia, ME and Africa, ACI Worldwide in a statement.

Also read: Radhakishan Damani’s Rs 1,000 crore home: DMart founder buys new property at Mumbai’s Malabar Hill

India’s digital payments market led by Paytm, PhonePe, Pine Labs, Razorpay, BharatPe, and others on the B2C and B2B sides has surged during the pandemic even as incentives such as cash backs, rewards, and offers have helped businesses to attract more customers. Moreover, policy frameworks such as Pre-Paid Instruments (PPI), Universal Payment Interface (UPI) by the NPCI apart from Aadhar, and the launch of BHIM-app have driven the financial inclusion and improved the payment acceptance infrastructure in the country in the past few years.

According to another report by the Indian Private Equity and Venture Capital Association (IVCA) and Ernst & Young, digital payments in India is expected to grow at 27 per cent CAGR during the FY20-25 period from Rs 2,153 lakh crore transactions in FY20 to Rs 7,092 lakh crore in FY25. UPI transaction value witnessed a growth of 18.7 per cent month-on-month to Rs 5.05 lakh crore in March 2021 from Rs 4.25 lakh crore in February 2021 while transaction volume rose by 19 per cent to 2,731.68 million from 2,292.90 million during the said period, according to data released by National Payments Corporation of India (NPCI).

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