UPI transaction value to quadruple by FY23

Covid-19 will provide additional impetus to contactless payments and see UPI transactions growing four-fold to Rs 87 lakh crore by FY23.

The payment industry will enter a new phase after Covid-19, as the pandemic has significantly changed the way consumers and businesses interact. Covid-19 has upended life globally and heralded a new normal across sectors-one that is low touch and highly digital in nature, finds a report by the Payments Council of India (PCI) and PwC.

The report estimates that India will grow exponentially in the post-Covid era and grab a 2.2 per cent share of the global payment market by 2023. UPI, which has broken all records in the Indian payments industry, will be mainly instrumental in this growth story. Unified Payments Interface has clocked 12.5 billion transactions, amounting to Rs 21 lakh crore in FY20, having grown at a compound annual growth rate (CAGR) of 785 per cent in volume and 570 per cent in terms of value between FY17 and FY20. Peer-topeer payments have been the major contributors of UPI volumes.

Based on PricewaterhouseCoopers' s internal analysis and forecast, the volume of the UPI product would reach nearly 59 billion by 2023 due to its high P2P type of transaction penetration. This will see transaction value quadrupling to Rs 87 lakh crore.

Similarly, Bharat Bill Payment System, which is meant for utility payments, will grow from 145 million transactions in FY20 to touch 569 million transactions by FY23. A 436 per cent CAGR will see transaction value growing from Rs 21,000 crore to Rs 94,000 crore by FY23. Aadhar-Enabled Payment Systems will see a growth from 254 million transactions to 2.4 billion transactions. The transaction value will cross Rs 7 lakh crore by FY23.

The National Electronic Toll Collection too will grow to 2.1 billion transactions. However, RuPay cards may see a modest growth by FY23, as the volumes and value might dip in FY21 due to Covid crisis.