Abstract

This study investigates the Unified Payments Interface (UPI) ecosystem in India from October 2022 to October 2024, focusing on UPI Payer and Payee Payment Service Provider (PSP) performance, UPI apps, and P2P (Peer-to-Peer) and P2M (Peer-to-Merchant) transactions. Using a mixed-methods approach, quantitative data from official sources like NPCI and RBI reports provides insights into transaction volumes, values, and trends across various PSPs and UPI apps. The study also explores factors influencing UPI growth, such as digital literacy and financial inclusion, using regression analysis. The research highlights the significant growth in UPI transactions, the dominance of leading apps like PhonePe and Google Pay, and the impact of UPI on digital payments for small and medium businesses. These findings aim to offer a comprehensive overview of the UPI landscape and its future potential in India’s digital payment sector. The data highlights the exponential growth and evolving landscape of UPI transactions in India over the three-year period. From October 2022 to October 2024, the total transaction volume surged from 7,305.42 million to 16,584.97 million, while the transaction value escalated from ?12,11,582.51 crores to ?23,49,821.45 crores. This growth underscores the increasing adoption and reliance on digital payments. Leading UPI apps such as PhonePe, Google Pay, and Paytm consistently dominated the market, reflecting their strong user base and robust infrastructure. Notably, new entrants like Navi, Cred, and FamApp by Trio also made significant inroads, indicating a diversification in user preferences and app offerings. In terms of bank performance, Axis Bank, Yes Bank, and ICICI Bank emerged as key players in both Payer and Payee PSP categories, maintaining high approval rates and substantial transaction volumes. The data also shows a clear distinction between peer-to-peer (P2P) and peer-to-merchant (P2M) transactions, with P2P transactions contributing significantly to the total transaction value. Overall, the UPI ecosystem’s remarkable growth, coupled with the diverse performance of various apps and banks, highlights the transformative impact of digital payments on the Indian economy. The trends reflect not only increased user confidence but also the efficiency and reliability of UPI as a preferred mode of transaction.

Authors

M. Dinesh Kumar
Mannar Thirumalai Naicker College, India

Keywords

Unified Payments Interface (UPI), National Payments Corporation of India (NPCI), Peer-to-Peer (P2P) Transactions, Peer-to-Merchant (P2M) Transactions, Virtual Payment Address (VPA) and Payment Apps (PhonePe, Google Pay, Paytm)