Worldline, a global leader in payment services, has published the -‘India Digital Payments Annual Report' for 2022 today. The report encapsulates important payment trends of the industry for the calendar year 2022 and has derived some unique insights.
How India Pays?
In 2022, payment modes like UPI, Debit and Credit cards, Prepaid Payment Instruments – Mobile and Prepaid cards processed 87.92 billion transactions worth INR 149.5 trillion.
It is evident that UPI Person-to-Merchant (P2M) and Person-to-Person (P2P) are the most preferred payment modes among consumers with a market share of 40% and 44% in terms of transactions volume (UPI was 84% in total). However, in terms of value, UPI P2M accounted for 18% share whereas UPI P2P accounted for 66% of digital transactions by value (UPI was 84% in total). It should be noted that P2P transactions are not necessarily payments and can also be potentially money transfers among people.
This is followed by payment through credit and debit cards which accounted for 7% in volume and 14% in value. The adoption of credit cards is growing at a healthy pace as it has long been a preference of customers when it comes to high ticket size transactions and is evident in the chart (on right) that highlights the Average Ticket Size of all payment modes.
Speaking on the digital payments annual report, Mr Ramesh Narasimhan, CEO, Worldline India said, “I am amazed every day to see the incredible progress we have made in the digital payments ecosystem over the past few years. The adoption of multiple payment solutions is a boon in our journey to realize the dream of a less-cash India.
The year 2022 witnessed an ever increasing adoption of digital payments, with UPI leading the way. Popular payment instruments like UPI, cards, PPIs were already clocking over INR 149.5 trillion worth of digital transactions in 2022. In 2023 and beyond, Worldline will continue to collaborate with our merchants, partner banks, fintechs, ecommerce players and invest in the technology and infrastructure needed to build a more inclusive and open financial ecosystem.
I am glad to present to you Worldline’s India Digital Payments Report covering key insights from the previous year. i.e. January till December 2022.”
Unified Payments Interface (UPI)
In the year 2022, UPI clocked over 74.05 billion transactions in volume and INR 126 trillion in terms of value. Its transactions volume and value almost doubled since last year as it recorded 91% increase in volume and over 76% increase in value in Year 2022 as compared to Year 2021.
As of year 2022, the top 5 UPI Apps in terms of volume and value were PhonePe, Google Pay, and Paytm Payments Bank App, Amazon Pay and Axis Bank while top Remitter and Beneficiary Banks are highlighted below:
As of December 2022, the total number of POS terminals deployed by merchant acquiring banks breached the 7.55 million mark; a 37% YoY growth. Private Sector Banks are dominating the space with 74% market share while Public Sector Banks account for 18%. Payments Banks and Foreign Banks continue to have a 7% and 1% market share respectively. The top POS deployers were HDFC Bank, Axis Bank, ICICI Bank, State Bank of India, RBL Bank, Paytm Payments Bank, IndusInd Bank covering 92% market share as of December 2022.
The total number of credit and debit cards in circulation by end of year 2022 was 1.02 billion. The number of outstanding credit cards increased by 18% from 69 million in December 2021 to 81.1 million in December 2022 while outstanding debit cards increased by 0.2% from 938 million to 939.4 million during the same period.
In the year 2022, credit cards volume and value stood at 2.76 billion and INR 13.12 trillion respectively. The number of credit card transactions at POS accounted for 1.47 billion while e-commerce was 1.29 billion. In terms of value, consumers transacted INR 5.1 trillion at POS and INR 8.1 trillion on e-commerce transactions via credit cards in the year 2022.
In Year 2022, debit card transactions volume and value stood at 3.64 billion and INR 7.4 trillion respectively. Out of the total debit card volume, transactions at POS accounted for 2.38 billion while transactions at e-commerce was 1.26 billion. In terms of value, INR 4.85 trillion was processed at POS terminals while INR 2.56 trillion was processed at e-commerce via debit cards.
Prepaid Payment Instruments
By December 2022, number of prepaid payment instruments were 16.23 billion. Out of which, 13.34 billion were wallets and 288.8 million were cards.
In the year 2022, NETC processed about 3.25 billion transactions worth INR 509.11 billion. The transactions volume increased by 31% while value increased by 37% as compared to the Year 2021. As of December 2022, total number of banks live with NETC FASTag were 36.
Bharat Bill Pay
The transactions volume passing through Bharat Bill Payment Central Unit (BBPCU) in Year 2022 stood at 985.7 million while the transactions value was INR 1.70 trillion. It registered a growth rate of 75% and 83% in volume and value respectively as compared with year 2021.
Aadhar Enabled Payment Service (AePS)
In the year 2022, AePS transactions recorded a substantial volume of over 2.63 billion transactions in volume and INR 3.42 trillion in value. It registered about 24% growth in volume and 20% in value over year 2021. AePS is a bank led model which allows online interoperable financial inclusion transaction at PoS (MicroATM) through the Business correspondent of any bank using the Aadhaar authentication.
Worldline India Insights
In 2022, frequently visited physical merchant categories like grocery stores, restaurants, clothing and apparel, pharmacy and medical, hotels, jewelry retail, specialty retail, household appliances and departmental stores together accounted for over 43% in terms of volume and about 40% in terms of value.
In the online space, e-commerce (shopping for goods and services), gaming, utility and financial services contributed to over 85% transaction in terms of volume and 25% in terms of value. Education, Travel & Hospitality sector contributes to the remaining 15% & 75% in terms of volume and value respectively.
The top 10 states & UT with the highest transactions for at physical touch points in 2022 for Worldline India were Kerala, Maharashtra, Tamil Nadu, Karnataka, Uttar Pradesh, Delhi, Telangana, Gujarat, West Bengal, and Punjab.
Whereas the top 10 cities with the highest number of transactions at physical touch points in 2022 for Worldline India were Bengaluru, New Delhi, Mumbai, Pune, Chennai, Hyderabad, Ernakulam, Thiruvananthapuram, Thrissur, and Coimbatore
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