UPI's share in total digital payments in India grows to 83% in 2024

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The contribution of Unified Payments Interface (UPI) to the cumulative digital payments ecosystem more than doubled in five years, rising from 34 per cent in 2019 to 83 per cent in 2024, according to data from the Reserve Bank of India’s (RBI) payment system report.

 

The share of other digital payment methods, such as National Electronic Funds Transfer (NEFT), Real Time Gross Settlement (RTGS), Immediate Payment Service (IMPS), and credit and debit cards, declined from 66 per cent in 2019 to 17 per cent at the end of 2024.

 

In 2024 alone, India recorded 208.5 billion digital payment transactions.

 

The growing share of India’s real-time payments system, UPI, can be attributed to the increasing adoption of this digital payment method.

 

Between 2019 and 2024, the volume of UPI P2M (person-to-merchant) payments grew faster than UPI P2P (person-to-person) transactions.

 

UPI P2M grew at a compound annual growth rate (CAGR) of 99 per cent for transaction values below Rs 500 over the five-year period. In contrast, UPI P2P grew at a CAGR of 56 per cent during the same period.

 

For higher ticket-sized transactions—those exceeding Rs 2,000—UPI P2M grew at a CAGR of 109 per cent during the same five-year period, while UPI P2P recorded a CAGR of 57 per cent.

 

The National Payments Corporation of India’s (NPCI) low-value transaction payment method, UPI Lite, recorded 2.04 million transactions daily, valued at Rs 20.02 crore in December 2024.

 

There was a 13 per cent year-on-year increase in the average ticket size of a UPI Lite transaction, rising from Rs 87 in December 2023 to Rs 98 in December 2024.

 

“When Paytm and PhonePe introduced UPI Lite on February 15, 2023, and May 2, 2023, respectively, a sustained increase in UPI Lite payment volumes and values was observed,” the RBI noted in its report.

 

Prepaid payment instruments (PPIs), which include digital wallets, declined by 12.3 per cent in volume, falling to 3.45 billion transactions in the second half of calendar year 2024 (H2 CY24) from 3.93 billion in H2 CY23.

 

During the same period, the value of transactions processed using PPIs dropped by 25 per cent, from Rs 1.43 trillion in H2 CY23 to Rs 1.08 trillion in H2 CY24.