Unified Payments Interface (UPI) stands as the primary catalyst in the substantial expansion of digital payments union finance ministry said in a written reply to Lok Sabha, contributing to a reduction in growth of bank notes in circulation to 7.8 per cent in the last fiscal year, as per government statement on Monday.
UPI growth in numbers
Minister of state for finance Bhagwat K Karad in a written reply to Lok Sabha said that UPI transactions have experienced substantial growth, surging from ₹92 crore in FY 2017-18 to ₹8,375 crore in FY 2022-23, boasting a remarkable Compound Annual Growth Rate (CAGR) of 147 per cent in terms of volume.
Simultaneously, he added, the value of UPI transactions has risen from ₹1 lakh crore in FY 2017-18 to ₹139 lakh crore in FY 2022-23, exhibiting a CAGR of 168 per cent.
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In the ongoing financial year until December 11, UPI has achieved 8,572 crore transactions. UPI emerges as the primary driver for the overall expansion of digital payment transactions, constituting 62 per cent of such transactions in FY 2022-23. Furthermore, the Year-on-Year growth in the value of bank notes in circulation has decreased from 9.9 per cent in FY 2021-22 to 7.8 per cent in FY 2022-23.
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Started in 2016, UPI is as an instant payment system crafted by the National Payments Corporation of India (NPCI), a regulated entity under the Reserve Bank of India (RBI). Leveraging the immediate payment service infrastructure, UPI facilitates immediate fund transfers between the bank accounts of any two parties.
Recently, RBI granted approval for linking RuPay credit cards to UPI, thus eliminating the need to carry the physical plastic card when utilising RuPay credit cards through UPI QR. The customers can use credit cards even at small merchant outlets equipped with QR codes.