UPI transactions witnesses 118% rise at retail stores in 2023: PayNearby Report

PayNearby, an Indian branchless banking and digital network, has released its 'Retail-O-Nomics' report, revealing a 118% increase in UPI transaction volume and a 106% rise in value at semi-urban and rural stores.

According to PayNearby, The surge indicates the expanding reach of UPI beyond Tier II regions, marking a notable shift in digital payment adoption across the country.

Technological advancements

The report also shows a 5% growth in mPOS (Mobile Point of Sale) acceptance, reflecting the adoption of advanced technology by small merchants.

Furthermore, there has been a substantial 150% increase in insurance policy purchases and premium collections, highlighting digital retail stores' role in enhancing insurance penetration in Bharat and their evolution into multi-utility centers.

Diverse transactions

PayNearby's analysis, based on transactions at over a million retail points, shows a 10% growth in diverse transactions, including banking, financial services, and digital offerings like utility payments and assisted commerce. Notably, The trend signifies a behavioural shift towards assisted digital methods and the integration of consumers into the formal economy, especially in semi-urban and rural areas.

Cash withdrawals 

Despite a shortfall in expected growth for Micro ATM and AePS cash withdrawals, the demand for MATM devices surged by 17%. Interestingly, AePS withdrawals saw a 30-40% increase during Direct Benefit Transfer (DBT) releases.

The report also highlights a 65% increase in cash collection at retail counters, indicating a high demand for credit and financial solutions, with a notable 25% surge in EMI collections for NBFCs, MFIs, and Small Finance Banks.

Emerging trends 

The assisted e-commerce segment, particularly meta-commerce, emerged significantly, with about 40,000 retailers engaged in e-commerce services.

The report also notes a robust growth in digital services subscriptions, including OTTs, online education, and gaming. Credit products like business, personal, and gold loans have seen rapid traction, with 21% of applicants being new to credit, highlighting a youthful entrepreneurial base.

Anand Kumar Bajaj, Founder, MD & CEO of PayNearby, said, “Embracing rural India’s pulse, Retail-O-Nomics depicts a narrative where hinterlands not only keep pace with urban areas but actively integrate into the formal economy. Despite the huge untapped market, this report aims to catalyze dialogues and implement measures for widespread financial and digital service accessibility, especially in Tier II and beyond."

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