The National Payments Corporation (NPCI) of India reported a 42% increase in consolidated revenue to ₹3,279 crore for the financial year ending in March 2024, from ₹2,311 crore in FY23. Net profit, termed “surplus” because NPCI is a not-for-profit corporation, was up 37% at ₹1,134 crore from ₹828 crore in FY23. This revenue growth is well backed by the growth of payment services that constitute 94% of the total revenue, amounting to ₹2,693 crore in FY24. This strong financial performance underlines how important NPCI has become in India’s digital ecosystem for payments and how it continues to hold a leading position in the market.
What is NPCI?
The National Payments Corporation of India is the backbone of digital payment in India. RBI and Indian Banks Association (IBA) launched it in the year 2008 as a “not-for-profit” company under the Companies Act 2013, Section 8. The rationale for setting up the NPCI was to provide a robust technology-driven backbone infrastructure for physical and electronic payment systems, promotion of financial inclusion, and a less-cash society. The major retail payment systems operated by NPCI include Unified Payments Interface, Immediate Payment Service, RuPay cards, National Automated Clearing House, Aadhaar Enabled Payment System, Bharat Bill Payment System, and FASTag, among others.
UPI has been an extraordinary product in the digital payment space in India, aggregating multiple bank accounts into one mobile application for frictionless transactions. More than 80% of all digital transactions take place in India via UPI, and with over 35 crore unique customers doing nearly 15 billion transactions every month worth over ₹20 lakh crore according to moneycontrol.
It manages its money quite effectively, which is a reason for such strong revenue growth. The company’s total spending increased from ₹1,183 crore in FY23 to ₹1,740 crore in FY24, an increase of 47.08%. At least 45% of that was spent on marketing, cashback, and promotion of digital transactions, principally for RuPay cards and UPI payments. Other costs involved employee benefits, maintenance costs of the network and technology, data centres, expert training, and other operational charges. The earnings before interest, tax, depreciation, and amortization (EBITDA) margin of 54% and high return on capital employed (ROCE) of 24.6% indicate that NPCI has a good financial position. In short, this exponential growth in revenue and profit only underlines the importance of NPCI in the overall digital payment ecosystem of the country.
With its range of payment products and further expansion into foreign markets, NPCI is forging ahead on the digital journey of the country. Very recently, NPCI launched some initiatives like UPI-ATM for enhanced convenience in cash withdrawal and UPI-Circle for ease in facilitating delegated payments. NPCI embarked on various collaborations internationally with countries such as Singapore and the UAE to allow the internationalisation of UPI to enable seamless cross-border payments for Indians living abroad. Ensuring the rapid growth of the digital payments space in India, NPCI remains at the centre of transforming the future of digital payments in India and beyond.
