Tag: upi

Credit card spends limping back to normalcy, but stay lower in Q1, BFSI News, ET BFSI

Personal Finance

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If you thought that the over 20% discount offered on credit for your Swiggy offer is exceptional, you may expect more.

Credit card spends are likely to be lower in the first quarter despite a recovery in June. Analysts see credit card spends dropping 8% in the first quarter of June 2021 over the fourth quarter of the last fiscal.

At Rs 54,700 crore, credit card spends in May 2021 were still higher than the monthly spends between April and September 2020.

In April 2021, credit card spends totalled Rs 59,200 crore, higher than the monthly spends witnessed between April and September of 2020.

Going by the trend of UPI transactions in June, credit card spends are also likely to be high in June.

UPI June transactions

UPI enabled digital transactions surged 11.6 per cent month-on-month to Rs 5.47 lakh crore in June this year, according to the NPCI data.

In May 2021, the UPI (unified payments interface) transactions stood at Rs 4.91 lakh crore.

In terms of numbers, there were as many as 2.80 billion (280 crore) transactions during the month under review, as against 2.53 billion (253 crore) in May, according to the data.

NPCI’s other digital payments channels—such as Bharat Bill Payment System (BBPS), National Electronic Toll Collection (NETC), Aadhaar Enabled Payment System (AePS) and Immediate Payment Service (IMPS)—all recorded monthly growth in June.

The number of transactions on BBPS, primarily used for automated bill payments, grew nearly 16% sequentially to 45.47 million transactions in June. For Fastag, the growth was even sharper—at 35.34% to 157 million transactions—indicating an increase in mobility.

Similarly, IMPS grew to 303.7 million transactions in June from 279.8 million in May while AePS — which is used for cash withdrawals at micro ATMs, subsidy payouts and domestic remittance—grew to 87.5 million transactions from 84.2 million.

Card companies

Despite a ban on issuing new credit cards, HDFC Bank retained the largest market share at 27 per cent in spends in May while SBI Cards held 18 per cent.

Credit card spends limping back to normalcy, but stay lower in Q1

In December 2020, the Reserve Bank of India (RBI) barred HDFC Bank from making new digital launches and issuing new credit cards following repeated outages on the bank’s digital channels.

HIt by the ban on HDFC Bank issuing credit cards and economic slowdown, the number of credit cards outstanding grew just 1.9 per cent 622.6 lakh, as against a growth of 2.2 per cent during April-June 2020 to 5.74 lakh, according to RBI data. The number of new cards issued has been falling every month since January 2021 and was down to 21 lakh in April from 70 lakh in January, with most card issuers seeing slow growth. Monthly spends per card for the industry declined to Rs 9,500 in April from an average of Rs 10,500 over the past six months, according to analysts.



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Bhutan becomes first country to adopt UPI standards for its QR deployment, BFSI News, ET BFSI

Banking & Finance

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BHIM UPI has forayed in Bhutan in collaboration with Royal Monetary Authority of Bhutan.

The service will be launched by India’s Finance Minister, Nirmala Sitharaman, Bhutan’s Finance Minister, Lyonpo Namgay Tshering, Governor of Royal Monetary Authority of Bhutan, Dasho Penjore, Secretary (Department of Financial Services) Shri Debasish Panda, Ambassador of Bhutan to India General V Namgyel, Ambassador of India to Bhutan, Ruchira Kamboj, MD & CEO of NPCI, Dilip Asbe.

NPCI’s international arm, NPCI International Payments Limited (NIPL) and Royal Monetary Authority of Bhutan (RMA) collaboration will help enable UPI acceptance powered by BHIM App in Bhutan.

NIPL said, “UPI QR transactions are accepted at all RMA acquired merchants in Bhutan. The launch will benefit more than 200,000 tourists from India who travel to Bhutan each year. With this launch, Bhutan will become the first country to adopt Unified Payment Interface (UPI) standards for its QR deployment. Bhutan will also become the only country to both issue & accept RuPay cards as well as accept BHIM UPI.”

In 2020, UPI enabled commerce worth USD 457 Billion, which is equivalent to approximately 15% of India’s GDP.

“Our vision has always been focused on taking our robust and popular payments solutions to global markets”, said Ritesh Shukla, CEO, NPCI International Payments Limited (NIPL).



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Digital payments recover in June

Banking & Finance

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With the gradual opening up of the economy from June, digital payments also shot up last month after subdued transactions in April and May.

Payments through the Unified Payments Interface touched a record high and neared the ₹5.5 lakh crore mark in June, according to data released by the National Payments Corporation of India.

As many as 280 crore transactions worth ₹5.47 lakh crore took place through UPI last month as against 253 crore transactions totalling ₹4.9 lakh crore in May.

This is only the second time that UPI payments crossed the ₹5 lakh crore mark. It was previously at ₹5.04 lakh crore in March, after which it fell for two consecutive months.

Payments on the Immediate Payment Service (IMPS) platform also registered growth in June. Over 30.3 crore transactions worth ₹2.84 lakh crore took place through IMPS as compared to 27.9 crore transactions amounting to ₹2.66 lakh crore in May.

Transactions on Bharat BillPay saw even more robust growth with 4.54 crore payments worth ₹7,934.71 crore in June. In contrast, it had registered 3.92 crore transactions totalling ₹6,270.31 crore in May.

Transactions on the Bharat BillPay platform have been rising all through April and May when there were localised lockdowns, with more people choosing to use it for payment of utility bills.

Payments through NETC FASTags also recovered in June but were still subdued compared to April levels. It recorded 15.78 crore transactions worth ₹2,576.28 crore in June as against 11.64 crore payments totalling ₹2,125.16 crore in May.

Transactions through Aadhar Enabled Payment System (AePS) also registered a sharp growth last month totalling 8.75 crore in volume worth ₹24,667.8 crore. In contrast, there were 8.42 crore transactions worth ₹24,619.24 crore in May on the platform.

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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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Kotak Mahindra Bank launches ‘Pay Your Contact’ service

Banking & Finance

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Kotak Mahindra Bank has announced launch of a new feature that enables its customers to send money or make payments to any of their contacts across all payment apps simply by the beneficiary’s mobile number.

The ‘Pay Your Contact’ service is available on the lender’s mobile banking app and uses the Unified Payments Interface (UPI) platform.

“The Pay Your Contact feature is interoperable across all payment apps and is available on both Android and iOS,” it said in a statement.

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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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UPI transactions stay below Rs 5 lakh crore for the second month in May, BFSI News, ET BFSI

Banking & Finance

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Unified payments interface (UPI) transactions fell in volume as well as in value for the second consecutive month in May as lockdowns restricted economic activity.

About 2.53 billion transactions worth Rs 4.9 lakh were recorded in May, a 4.16% drop in volume and 0.6% fall in value compared with April, according to National Payments Corp of India data.

However, the transactions rose on an annual basis as last May was a total lockdown. UPI transactions in terms of value stood at Rs 21 lakh crore in May 2020, from where they had climbed over Rs 5 lakh crore in March 2021. Bharat Bill Pay transactions grew 11.6% in volumes at 39.22 million logging Rs 6,270 crore in May. It grew 20.5% in value from April. In March, Bharat Bill Pay had registered 35million transactions of Rs 5160 crore. FASTag transactions dropped to 116.48 million in terms of volume and Rs 2,125 crore in value from 164.33 million n and Rs 2,777 crore, respectively in April, showing limited mobility.

NEFT fund transactions dropped 10.3% to 256.5 million transactions worth Rs 18.19 lakh crore, from 286 million transactions worth Rs 20.46 lakh crore in April.

RTGS transactions fell to 12.3 mln settlements, worth Rs 83.66 lakh crore in May from 15.1 million worth Rs 88.02 lakh crore in April.

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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ICICI Bank launches facility to link UPI ID with digital wallet

Banking & Finance

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Private sector lender ICICI Bank has launched a facility for linking a Unified Payments Interface (UPI) ID with its digital wallet, ‘Pockets’.

The facility is a departure from the current practice under which UPI IDs can be linked with a savings bank account.

“This initiative enables users to undertake small-value daily transactions directly from their Pockets wallet using UPI in a safe and secure manner,” said ICICI Bank in a statement on Wednesday, adding that it would help them streamline the number of transactions being undertaken daily from their savings account and, thus, de-clutter their savings account statement of multiple entries.

“Further, it expands the convenient usage of UPI to young adults like college students, who may not have a savings account,” it said.

10 lakh customers of other banks using ICICI Bank’s mobile app

New users, including those who are not customers of ICICI Bank, can now instantly get a UPI ID, which is automatically linked to Pockets, while customers who already have a UPI ID will get a new ID when they log on to the Pockets app.

Ties up with NPCI

The bank has collaborated with National Payments Corporation of India to link its ‘Pockets’ digital wallet to the UPI network.

“Our research suggests that users are keen to link their UPI ID with their digital wallet, so that they can directly use the balance in the wallet for smaller transactions while using their savings account only for the larger ones. We believe the facility will provide immense convenience and the advantage of secured UPI payments to customers using Pockets wallet,” said Bijith Bhaskar, Head, Digital Channels and Partnership, ICICI Bank.

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ICICI Bank links UPI ID facility to its ‘Pockets’ digital wallet, BFSI News, ET BFSI

Banking & Finance

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ICICI Bank announced the launch of a facility of linking a UPI (Unified Payments Interface) ID to its digital wallet ’Pockets’, marking a departure from the current practice that demands such IDs be linked with a savings bank account. The Bank has collaborated with NPCI to link its ‘Pockets’ digital wallet to the UPI network. This initiative allows users to conduct small-value daily transactions using UPI directly from their ‘Pockets’ wallet in a safe and secure manner.

Customers who use ‘Pockets’ can now send and receive money directly from and to their ‘Pockets’ wallet balance without using their savings bank account. The UPI ID can be used by users of the ‘Pockets’ digital wallet to make person-to-person (P2P) payments, such as sending money to any Individual’s bank account or paying to a contact. They can also undertake person to merchant (P2M) payments like paying online at merchant sites or paying by scanning QR codes.

Bijith Bhaskar, Head- Digital Channels & Partnership, ICICI Bank said, “Our research suggests that users are keen to link their UPI ID with their digital wallet, so that they can directly use the balance in the wallet for smaller transactions while using their savings account only for the larger ones. Armed with this insight, we are delighted to have worked closely with NPCI to introduce this unique innovative solution in digital banking.”

Praveena Rai, COO, NPCI said, “This initiative will further democratize access to UPI and make it ubiquitous with digital payments by allowing consumers to directly pay through their digital wallets, in addition to the facility of paying from their bank accounts. UPI is a one-stop solution to payments of all kinds, both P2M and P2P, and this facility will provide an impetus to the burgeoning digital ecosystem in India.”



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NITI Chairman, BFSI News, ET BFSI

Personal Finance

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India is seeing an increasing digitization of financial services, with consumers shifting from cash to cards, wallets, apps, and UPI, Niti Aayog Vice-Chairman Rajiv Kumar said on Monday. While releasing a report — Connected Commerce: Creating a Roadmap for a Digitally Inclusive Bharat — prepared jointly by Niti Aayog and Mastercard , Kumar said this report looks at some key sectors and areas that need digital disruptions to bring financial services to everyone.

“Technology has been transformational, providing greater and easier access to financial services. India is seeing an increasing digitization of financial services, with consumers shifting from cash to cards, wallets, apps, and UPI,” he said.

The report recommended that there is a need to strengthen the payment infrastructure to promote a level-playing field for NBFCs and banks.

It also pitched for digitizing registration and compliance processes and diversifying credit sources to enable growth opportunities for MSMEs.

According to the report, there is a need to build information sharing systems, including a ‘fraud repository’, and ensuring that online digital commerce platforms carry warnings to alert consumers to the risk of frauds.

It also pitched for enabling agricultural NBFCs to access low-cost capital and deploy a ‘phygital’ (physical + digital) model for achieving better long-term digital outcomes.

“Digitizing land records will also provide a major boost to the sector,” the report said, adding that to make city transit seamlessly accessible to all with minimal crowding and queues, there is need to leverage existing smartphones and contactless cards, and aim for an inclusive, interoperable, and fully open system .

Also speaking at the event, Mastercard. Asia Pacific Co-President Ari Sarker said the Covid-19 pandemic has alerted us all to the fragility of cash and the resilience of digital technologies, including digital payments.

“India has changed its operating landscape in making digital more accessible and friction free. It is one of the most advanced digital payments environment in the world. Now is the time to take our learnings and digital transformation-at-scale with speed and agility,” he said.

Niti Aayog CEO Amitabh Kant said in the post-COVID-19 era, building resilient systems and encouraging business models that could be change-makers of the future are crucial.

Kant further said India is emerging as the hub of digital financial services globally, with solutions like UPI growing tremendously and being hailed as instrumental in bringing affordable digital payment solutions to the last mile.



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