India's UPI just processed record 700M transactions in a day
What's the story
India's Unified Payments Interface (UPI) has hit a new milestone, processing over 707 million transactions in a single day on August 2. The data was shared by the National Payments Corporation of India (NPCI), highlighting UPI's rapid growth. The platform has come a long way since 2023 when it processed around 350 million transactions daily. By August 2024, this number had jumped to 500 million and now comfortably crossed the 700 million mark.
Growth trajectory
Government aims for 1 billion daily transactions by next year
The Government of India is targeting a whopping 1 billion daily transactions by next year. UPI, a real-time payment system, connects multiple bank accounts through a single mobile app for seamless peer-to-peer and merchant transactions. Once linked with a bank account, users can make payments using just their phone number or UPI ID without entering card numbers or bank details.
Market influence
UPI's rapid growth
UPI's record-breaking 707 million daily transactions milestone highlights how deeply embedded UPI has become in India's financial ecosystem. Nearly 85% of all digital payments in India now go through this platform. Merchant payments account for about 62% of all UPI transactions, showing that businesses have embraced the system.
Payment dynamics
Global payment giants under pressure
UPI is also giving global payment giants like Visa and Mastercard a run for their money in terms of daily volume. The key difference is that UPI settles payments in real time, while card networks follow delayed settlement models. However, the rapid growth has raised concerns over the lack of Merchant Discount Rate (MDR) on UPI payments, which leaves banks and payment apps with little revenue from transactions.
Platform support
UPI payments supported by numerous apps
UPI payments are supported by a variety of apps, including Paytm, PhonePe, Google Pay, Amazon Pay, BHIM and banking apps like SBI Yono and ICICI iMobile. Even money lending apps such as CRED and Slice have integrated UPI payments. UPI is linked with over 300 banks across India for payments at physical stores, online shopping, bill payments and donations.
Banking shift
A less-cash economy
The rise of UPI is slowly replacing cash and debit cards, especially in urban areas. While bank transfers through NEFT and IMPS still exist, they're being used less for small transactions. Traditional banking remains important for big financial decisions, loans or investments but UPI is now the preferred choice for daily transactions. This shift brings India closer to becoming a less-cash economy.