P2M is more than 50% of UPI volumes now, says NPCI chief Dilip Asbe

The staggering success of UPI is well-known by now. But some stats need reiteration. Last month, the platform processed a record 7.3 billion transactions, with payment value amounting to an all-time high of Rs 12.1 lakh crore. Nobody imagined it would get here, says Dilip Asbe, MD and CEO of the National Payments Corporation of India (NPCI) that operates UPI. 

In conversation with Business Today Editor Sourav Majumdar at the India Today Conclave Mumbai 2022, Asbe shared, “The kind of scale we can process today, we ourselves wouldn’t have believed 7-8 years ago. The Prime Minister influenced the growth of UPI and gave us the vision that self-reliant domestic payments systems are important for the country.”

Interestingly, in the last few months, peer-to-merchant (P2M) transactions have outnumbered peer-to-peer (P2P) ones. “P2P was 90 per cent of UPI volumes earlier. Now, P2M is more than 50 per cent, and some of the P2P is actually P2M, when you make payments to self-service numbers,” Asbe revealed. He also added that QR codes now reach even India’s Tier 6 towns, taking the digital payments revolution further ahead. 

But UPI is far from saturated, reckons the NPCI chief. “When you look at any developing country, digital payments are 60 per cent of personal expenditure. We are at 25-30 per cent now. So, 10X growth is still possible. And UPI will be the core driver of this. The RBI recently announced feature phone payments and voice-based payments. So, a lot of growth will come from the rural centres,” he stated. 

Taking inspiration from the successful ‘UPI model’ is T Koshy, CEO of Open Network for Digital Commerce (ONDC) which aims to break the existing monopolies and duopolies in ecommerce by bringing every player – big or small – on a single, open, and “equal” network. Koshy hopes ONDC can do for e-commerce what UPI did for payments, but in half the time. “I am where Dilip was six years ago. There was a lot of skepticism as to whether something like this [UPI] can be pulled off,” he says. 

Further elaborating on ONDC’s long-term vision, Koshy explained, “Any transaction has two parts - money and goods and services. NPCI brought democratization in money transactions. It showed us that money is not anyone's private property or a closed loop. That’s what we expect ONDC to do for goods and services. What Dilip managed to do at a difficult time in eight years, we should be able to do in four years.”

ONDC’s goal is to make India’s 1.4 billion citizens accessible as customers and buyers to sellers of all sizes on one transparent platform. “These people will be brought onto the network by telcos, banks, fintechs, and start-ups collectively. We are on an evangelisation programme right now with the MSME Ministry and other state [bodies] to help sellers use the network and help their industry segments,” Koshy added. 

Doffing his hat to both NPCI and ONDC was Invest India MD-CEO Deepak Bagla. “What they are doing is not just about numbers. It is not even the beginning of the most unprecedented transformation they are propelling. For the first time in history, each and every citizen of this country can participate in the growth and partake in the benefits of that growth. And these two gentlemen are making it possible,” he said. 

Bagla further shared that India accounted for a whopping 49 per cent of the world’s real-time transactions in 2021. The year also saw a unicorn (start-ups valued over a billion USD) being added every nine days. “Today, a brand-new company can get 100 million customers in 180 days. If we were driving a passenger car eight years ago, today we are in a Formula 1 car. The story has just begun,” he added.

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Also read: India Today Conclave Mumbai live updates: 'ONDC is not a platform, it is a network,' says CEO T Koshy