PhonePe continues to dominate in UPI transactions in July

PhonePe maintained its monthly lead in United Payments Interface (UPI) transactions, reporting 1.4 billion transactions in July, accounting for a 46% market share in total UPI transactions. According to data from the National Payments Corporation of India (NPCI), the total value of PhonePe transactions in July was Rs 288,572 crore.

Following, Google Pay to be the second-highest number of transactions at 1,119.16 million, totaling Rs 230,874 crore and surpassing the billion-transaction mark. The Payments Bank App by Paytm processed 454.06 million transactions worth Rs 51,694 crore. Google Pay had a volume market share of 34.45%, while Paytm Payments Bank App had a 14 percent share.

Volumes for PhonePe have been increased by more than 15% month on month (MoM), Google Pay increased by 15%, and Paytm Payments Bank App increased by 18.50%.

Besides this, Last month, UPI transactions have once again set new records, with total UPI transactions reaching 3,247.82 million and transaction value surpassing Rs. 6 lakh crore for the first time.

According to NPCI's guidelines on volume cap for Third-Party Application Provider (TPAP), payment apps such as PhonePe and Google Pay will have to adhere to a volume market share cap of 30% beginning January 1, 2021. Existing TPAPs that have exceeded the volume cap as of December 31, 2020, will have two years from the effective date to comply with the provisions.

NPCI launched UPI in 2016, and it quickly became a popular option for money transfers and merchant payments among consumers. While it began with only 9 million transactions in July 2016, it surpassed the billion mark in October 2019. It only took a year for UPI to more than double this and cross the $2 billion mark.

The 30% cap was implemented to help address the risks associated with a single app overloading the UPI payments infrastructure. Several experts and stakeholders, however, saw the move as NPCI's attempt to ensure that India's digital payments market allows new entrants and is not monopolized by the few large players who currently dominate the market.

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