New Delhi, Oct 1: India’s digital payments ecosystem continued to expand in September, with transactions through the Unified Payments Interface (UPI) registering strong year-on-year growth, according to data released by the National Payments Corporation of India (NPCI) on Thursday.
UPI transaction volumes increased 23 per cent year-on-year to 24.07 billion in September, while the total value of transactions rose 18 per cent to Rs 29.37 lakh crore.
On a daily average, UPI processed around 802 million transactions, with the average daily transaction value estimated at approximately Rs 97,913 crore.
The September figures remained close to the record levels seen in August. In August, UPI processed 24.51 billion transactions, up 22 per cent year-on-year, while the transaction value rose 20 per cent to Rs 29.82 lakh crore.
IMPS also records steady growth
The country’s instant fund transfer system, Immediate Payment Service (IMPS), also recorded growth during September.
According to NPCI data, IMPS transaction value increased 18 per cent year-on-year to Rs 7.06 lakh crore. The system processed an average of around 11.80 million transactions per day, with the average daily transaction value standing at nearly Rs 23,530 crore.
Traders withdraw ‘No UPI Day’ call
The latest UPI data comes amid discussions around proposed charges on certain merchant transactions. Leading traders’ organisations have withdrawn their proposed call to observe October 2 as a “No UPI Day” following a meeting with Union Finance Minister Nirmala Sitharaman in New Delhi.
A delegation of around 20 trade representatives from different states raised concerns over the proposed 0.4 per cent fee on eligible merchant UPI transactions above Rs 2,000.
The delegation, led by Praveen Khandelwal, Member of Parliament from Chandni Chowk and Secretary General of the Confederation of All India Traders (CAIT), said that the proposed fee could increase costs for small and medium-sized businesses and influence merchant adoption of digital payments.
Most small-value UPI merchant payments remain outside MDR
Under the proposed framework, MDR would apply only to eligible person-to-merchant (P2M) UPI transactions above Rs 2,000. Transactions up to Rs 2,000 would continue to carry zero MDR.
Government data indicates that more than 96 per cent of UPI merchant transactions by volume are valued at up to Rs 2,000. This means the vast majority of merchant UPI payments would continue without MDR and the associated GST on MDR.
Merchants receiving up to Rs 1 lakh in UPI payments per month would also remain outside the MDR framework.
The proposed changes do not affect person-to-person (P2P) UPI transactions. UPI transfers between individuals will continue to remain free, irrespective of the amount transferred.
The September data underlines the continued scale and adoption of digital payments in India, even as policymakers, merchants and industry bodies assess the evolving framework for sustaining the country’s rapidly expanding digital payment ecosystem.
