UPI to account for 90 pc of retail digital payments by 2026-27: Report
   Date :29-May-2023

UPI to account 
 
 
Business Bureau
Growing at a steady pace, UPI transactions are likely to reach 1 billion per day by 2026-27, accounting for 90 per cent of the retail digital payments in the country, said a PwC India report. Unified Payments Interface (UPI), which is driving the digital payments revolution, accounted for about 75 per cent of the total transaction volume in the retail segment during 2022-23, said the PwC report titled “The Indian Payments Handbook – 2022-27”.
UPI is projected to account for 90 per cent of the total transaction volume in retail digital payments over the next five years, the report said. The Indian digital payments market saw steady growth at a CAGR of 50 per cent (volume-wise) and is expected to reach 411 billion transactions in FY 2026-27 from 103 billion in FY 2022-23, the report said. “It is estimated that UPI will record 1 billion transactions per day by FY2026–2027, going from 83.71 billion transactions in 2022-23 to 379 billion transactions by 2026-27,” it added. It further said the credit card segment continues to grow at a healthy rate, as card (both debit and credit) payment is one of the most used instruments for retail digital payments after UPI. The volume of transactions in credit cards is expected to surpass debit cards by FY 2024–2025.
While credit card issuance is expected to grow at a healthy CAGR of 21 per cent in the next five years, debit card issuance is expected to have a stagnant growth with a CAGR of 3 per cent in the same period, the report said. “The decline in debit card usage is because the major use case of debit card transactions is cash withdrawal, which can now be replaced by an easier way of withdrawing cash using UPI,” it added. Mihir Gandhi, Partner and Payments Transformation Leader, PwC India, said that in the next five years, the payments industry is expected to focus on ecosystem expansion and new use cases for existing payment platforms.