The following article is based on my own interpretation of the said events and/ or publicly available information. Any material borrowed from published and unpublished sources has been appropriately referenced. I will bear the sole responsibility for anything that is found to have been copied or misappropriated or misrepresented in the following post.
Divyam Jain, MBA 2016-18, Vinod Gupta School of Management, IIT Kharagpur
In April, 2016, an immediate service platform was launched by the National Payments Corporation of India (NPCI) named Unified Payment Interface. It was designed with a vision of a more digital and less cash form of Indian society and market. With 36 banks allowing payments through UPI, this platform is charging towards its vision.
UPI provides hassle free transactions without the need of filling your card details etc to make the transaction. This makes it a fast way of making merchant payments, remittances, bill payments etc. As the user only provides a virtual address for the transaction, it adds an additional level of safety to the transactions. With all these features and facilities, UPI is set to hit the 1000 Cr. mark in January, 2017 which is quite a rapid growth as compared to only 90 Cr. worth of transactions in November, 2016. As per RBI data, the net transaction between January 1 and 19 was 990.18 Cr. while that of the whole December was 712.03 Cr. This shows the growth rate of the UPI facility.
Another factor that has contributed towards the growth of UPI transactions is the Demonetization announced in November, 2016 because of which a lot of transactions moved to the UPI platform and people became more aware of this facility and its benefits. Even with the numerous digital wallets giving competition to UPI by giving various deals and fancy offers to the customers, UPI is still soaring and is targeting to surpass these wallets in the near future.