How to optimise online payment processingJun 09,2023
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Worldline Editorial Team
The India Digital Payments Report Q3 2022 released in early December provides some unique insights about how the country is paying. The report highlights the analysis of the transactions available in public databases as well as processed by Worldline India in the third quarter (July – September 2022)
Haven’t had the time to go through the India Digital Payments Report Q3 2022? Worry not! Here are the noteworthy points summarized from the last quarter’s report:
In Q3 2022, UPI, Debit and Credit cards, Prepaid Payment Instruments like Mobile Wallets, and Prepaid Cards executed 23.06 billion transactions amounting to INR 38.32 trillion. UPI Person-to-Merchant (P2M) and Person-to-Person (P2P) emerged as the most chosen payment method among consumers, accounting for 42% of total transaction volume (UPI was 85%). Conversely, in regards to value, UPI P2M contributed to 19% of digital transactions, whereas UPI P2P counted for 65% (UPI was 84% in total). This is followed by credit and debit card payments, which accounted for 7% of volume and 14% of value.
In Q3 2022, UPI clocked over 19.65 billion transactions in volume and INR 32.5 trillion in terms of value. Its transactions volume and value almost doubled since last year as it recorded about an 88% increase in volume and over 71% increase in value in Q3 2022 as compared to Q3 2021. As of September 2022, the UPI ecosystem included 358 banks.
As of Q3 2022, the top 3 UPI Apps in terms of volume and value were PhonePe, Google Pay, and Paytm Payments Bank App. The top five Remitter Banks were State Bank of India, HDFC Bank, Bank of Baroda, Union Bank, and ICICI Bank whereas the top 5 Beneficiary Banks were Paytm Payments Bank, YES Bank, State Bank of India, Axis Bank, and ICICI Bank.
Worldline established a partnership with NPCI International in October 2022 to facilitate mobile payment for Indian tourists in Europe. The new agreement will enable merchant POS systems to accept payment via UPI and later, RuPay.
Q3 data indicates healthy usage of credit cards and growth in the average ticket size. For Credit cards it is INR 4,833, Debit cards it is INR 2,073, UPI P2M it is INR 738, UPI P2P it is INR 2576, prepaid cards it is INR 473, and M-wallet INR 382. The total transaction between credit cards and debit cards comes to around 65% and the remaining 35% has been shared between UPI P2P, UPI P2M, and Prepaid Cards.
Q3 witnessed 23.06 billion online transactions from payment modes like UPI, Debit and Credit cards, PPI, and mobile wallets
By the conclusion of the third quarter of 2022, there would be 1.01 billion credit and debit cards in circulation. The number of outstanding credit cards climbed by 19% from 65 million in September 2021 to 77.7 million in September 2022, while outstanding debit cards increased by 2% from 920.3 million to 938.53 million during the same time.
As of September 2022, the top credit card issuing banks were HDFC Bank, State Bank of India, ICICI Bank, Axis Bank, and Kotak Bank, while the top debit card issuing banks were State Bank of India, Bank Of Baroda, Union Bank, Canara Bank, and HDFC Bank.
Credit card volume and value were 725 million and INR 3.5 trillion in Q3 2022, respectively. Credit card transactions at POS accounted for 386.83 million, while e-commerce accounted for 338.80 million. In terms of value, in Q3 2022, customers spent INR 1.31 trillion at POS and INR 2.18 trillion on e-commerce purchases using credit cards. It's important to note that, despite the general trend of transactions shifting from the physical to the digital environment, credit card volume at POS and online is virtually equal in Q3 2022.
In the third quarter of 2022, the volume and value of debit card transactions were 907 million and INR 1.88 trillion, respectively.
POS transactions accounted for 595.4 million of the total debit card volume, while e-commerce transactions contributed to 311.60 million. In terms of value, POS terminals processed INR 1.19 trillion, while e-commerce via debit cards processed INR 681.7 billion. Debit card clients typically use their cards for small ticket-size transactions at physical touchpoints, but value-added services including EMI and BNPL are suddenly allowing consumers to use their cards for high-value items and services. Festive season sales and hyperlocal service delivery are also contributing to the development of debit card e-commerce transactions.
NETC completed around 796 million transactions worth INR 126 billion in the third quarter of 2022. When compared to Q3 2021, transaction volume climbed by 36% while value increased by 40%.
As of September 2022, the total number of banks using NETC FASTag was 36, with about 58.78 million NETC FASTags issued since the program's commencement.
Apart from adoption across national and state roadways, NETC FASTag has continued to grow and facilitate electronic payments at parking plazas across malls, metro stations, hospitals, and airports, among others. Currently, over 40 parking plazas in over 20 major cities accept FASTags for parking costs.
In Q3 2022, frequently visited physical merchant categories like grocery stores, restaurants, clothing and apparel, pharmacy and medical, hotels, jewelry retail, specialty retail, household appliances, and departmental stores together accounted for over 61% in terms of volume and about 58% in terms value.
In the online space, e-commerce (shopping for goods and services), gaming, utility & financial services contributed to over 86% of the transaction in terms of volume and 47% in terms of value.
HDFC Bank, Axis Bank, ICICI Bank, State Bank of India, RBL Bank, Paytm Payments Bank, and IndusInd Bank are the top acquiring banks with 91% market share in terms of POS deployment.
Top 10 States:
1. Maharashtra 2. Karnataka 3. Kerala 4. Tamil Nadu 5. Andhra Pradesh 6. Delhi 7. Uttar Pradesh 8. Gujarat 9. Telangana 10. West Bengal
Top 10 Cities:
1. Bengaluru 2. Hyderabad, 3. Chennai 4. Mumbai 5. Pune 6. Delhi, 7. Kolkata, 8. Thiruvananthapuram, 9. Coimbatore, 10. Thrissur
Read the full report here:https://in.worldline.com/reports-and-insights