Quantities of digital payment on most NPCI channels report record declines in April

Mumbai: Digital payments on fast-growing channels, such as Unified Payments Interface (UPI), Instant Payment Service (IMPS), National Electronic Toll Collections (Netc) and the Bharat Bill Payment System (BBPS), operated and operated by the National Payments Corporation of India, reported record volume and value gains in April.

The Aadhar activated payment system was the only channel that recorded increased transactions on the basis of disbursements of the government relief fund to the beneficiaries through the channel.

Subdued trade and a near-freeze on discretionary spending in a month where consumers across the country were forced to stay home due to nationwide shutdowns implemented to curb the spread of coronavirus are the reasons for the decline.

The popular payment channel UPI, which by 2020 has constantly scaled over 1 billion monthly transactions, processed 99 crore transactions worth Rs.1.5 lakh crore in April, as per the previous year. Data released by NPCI on twitter. This is a decrease of 20.8% and 26.7% respectively in volume and value of transactions against payments processed in March – the highest monthly jump since UPI’s start in 2016.

Similarly, IMPS channels, which are typically used to transfer major ticket funds immediately, also saw volumes and value of payments with a record of 43.5% and 40.1%, respectively. The channel recorded 12 crore transactions worth Rs.1.21 lakh crore in April, NPCI data showed.

“A significant 30% drop in online payments over the last 30 days is something we are seeing for the first time after demonetisation,” said Harshil Mathur, CEO, Razorpay about the trend of digital payment over the lock period in a recent report. “In the first two weeks of March before shutdown, total online spending increased by about 10%, but later it saw a dip primarily due to preventative measures that people began to take indoors.”

However, the most affected payment channel was NPCI’s Fastag, which uses NETC rails to digitally accept payments on toll roads on national highways. A complete restriction on movement of vehicles other than for essential services and the closure of state borders meant that Fastag’s monthly collections in April fell by over 80% by March.

A total of 1 crore transactions worth Rs. 247 crore was processed at toll booths via Fastag in April against 8.4 crore transactions worth Rs. 1400 crore in March and 11 crore transactions worth. Rs. 1800 crore in February.

NPCI’s billing platform Bharat Bill Payment Systems (BBPS) also recorded declines in payment volumes despite advice from the government and regulators to customers to pay bills online. The channel reported 1.2 crore bill payments for Rs. 1371 crore in April against 1.6 crore payments worth. Rs. 1953 crore in March.

Aadhar Enabled Payment System (AePS), which is central to the government’s DBT architecture for distribution of relief funds, was the only payment channel to record increased volumes of transactions in April. A total of 41 crore transactions worth Rs. 14,708 crore was processed in April – more than twice of the 18 crore transactions processed in March – mainly on the back of increased payout to beneficiaries of various government relief schemes.

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