Walmart-owned UPI app PhonePe has again topped the list of UPI apps with 7,236.49 million transactions by volume worth Rs. 10,33 Lakh Crore which translates into 48.4% by volume and 50.1% by value in the latest monthly statistics of August 2024 published by National Payments Corporations Of India (NPCI).
Google Pay continued to remain at the 2nd position with 5,592.45 million transactions by volume worth Rs 7,42 Lakh Crore which translated to 37.3% market share, while Paytm’s market share slipped to 7.2% in August from 7.82% a month ago. Besides the top three players, UPI apps such as CRED, Axis Bank app, and Navi stood at 4th, 5th, and 6th position, respectively.
The value of UPI transactions also saw a growth of over 30% worth Rs. 20.64 trillion. This is the third consecutive month when the UPI transaction exceeded Rs 20 trillion. In June 2024, the value was Rs 20,07 trillion, and in May 2024 it was Rs 20.44 trillion. NPCI data also showed that the average daily transaction value through UPI was about Rs 466 million. UPI transactions experienced a year-on-year growth of 57% in FY24, which accounted for 80% of all digital payment volume in India.
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In July too, PhonePe dominated the list with a 48% market share, followed by Google Pay at 37% and Paytm at 7.82%. While Cred and Axis Bank app stood at 4th and 5th position in UPI app transactions in July.
To control this dominance by a few apps in UPI transactions, NPCI proposed in 2022 a market cap of 30% for UPI payment apps. UPI apps were asked then to limit their market share to 30% in 2 years, and the deadline to introduce this limit was December 2024.
NPCI will again review this deadline by the end of this year, and it is highly unlikely that NPCI will enforce this cap and as experts say NPCI will extend the limit deadline this year too.
The rise in UPI transactions, going beyond Rs 20 trillion for the third month in a row, shows how much people in India now depend on paying digitally. UPI makes up a whopping 80% of all digital payments in FY24. Even though there’s a plan to cap the market to stop a few apps from being too powerful, it looks like NPCI won’t put this limit in place by December 2024 as planned. As UPI keeps growing fast, a handful of companies might keep dominating the UPI space. This means it’s key to find a sweet spot between having a competitive market and making things easy for users.
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