UPI Achieves Record Daily Transactions Exceeding ₹1 Lakh Crore
In October, UPI's average daily transaction value surpassed ₹1 lakh crore for the first time, driven by festive spending.
UPI's average daily transaction value reached ₹1 lakh crore in October.
Total monthly transactions hit ₹31.53 lakh crore, a record high.
Implementation of merchant discount rates (MDR) postponed until after Diwali.
In a significant milestone for India's digital payment landscape, the Unified Payments Interface (UPI) recorded an average daily transaction value exceeding ₹1 lakh crore in October 2023. This achievement marks the first time UPI has crossed this threshold, with the total monthly transaction value reaching ₹31.53 lakh crore, largely attributed to increased consumer spending during the festive season.
Prior to this, the highest average daily transaction value was approximately ₹98,000 crore, set in September 2023. Additionally, UPI surpassed the ₹30 lakh crore mark for monthly transactions for the first time, breaking the previous record of ₹29.9 lakh crore established in May 2023. The National Payments Corporation of India (NPCI) reported that UPI facilitated 25.47 billion transactions in October, averaging around 821 million transactions daily.
The surge in UPI transactions is notable, especially considering that the platform accounts for 89 percent of all digital payments in India. Historically, months with 31 days tend to see higher transaction volumes due to increased consumer activity, and October's performance reflects this trend. The previous record for daily transaction volume was 802 million in September, while August recorded the highest monthly transaction volume at 24.5 billion.
As UPI transactions soar, the payments ecosystem is also preparing for the introduction of merchant discount rate (MDR) charges on certain transactions. However, the NPCI announced a postponement of these charges until after Diwali, which is set for the second week of November. This decision came in response to requests from merchant associations and fintech companies, who expressed concerns about the potential impact on consumer sentiment during the festive sales period.
The UPI Steering Committee had previously set the MDR at 0.4 percent for merchant transactions exceeding ₹2,000. This fee, which translates to ₹8 for every ₹2,000 spent, is expected to generate approximately ₹15,000 crore in revenue for banks and payment companies, allowing for further investment in the digital payments infrastructure. As the festive season continues, stakeholders are keenly observing how these developments will influence consumer behavior and the overall digital payments landscape in India.
