With extraordinary innovation skills, the National Payments Corporation of India (NPCI) has scaled up financial technology like no other. The quasi-regulatory body recently crossed a milestone of 10 billion transactions a month. Riding high on this success, NPCI chief, Dilip Asbe envisions that India may soon touch 100 billion Unified Payment Interface (UPI) transactions a month soon.

During a fireside chat with Rajan Anandan, MD, Peak XV, at the Global Fintech Fest in Mumbai today, Asbe says that while UPI is being used by 350 million people presently, the company's vision is to be used by every Indian.

Moreover, driven by the growth of credit on the platform, UPI is targeting 2 billion transactions a day which pegs the growth opportunity in merchants and users at more than 3 times.

"We have a 3x opportunity on the user side and a 3x opportunity on the merchant side. I see a total growth opportunity of 10x for UPI," shares Asbe.

Although no specific date was announced by which NPCI aims to reach this milestone, Abse says that by 2030 he expects India to touch 2 billion transactions a day and "...if you take the combined effect, we have a 10x opportunity from where we stand," Asbe adds.

Interestingly enough at present, global conglomerate Visa processes 22.5 billion transactions a month, while its adversary MasterCard renders over 11 billion transactions.

The NPCI chief further opines that credit card usage can witness a ten-time growth if the industry shifts to the emerging trend of sachetisation, but also notes that it is possible only if banks provide the right platforms.

Assessing the credit landscape in the country, he says, "Sachetisaion of credit is coming… Moving forward, we are now looking at a completely digital onboarding journey."

With the fintechs getting involved on the credit side, Asbe does not believe that a 10x growth is too ambitious. In fact, he says that at least 50% of the top 30 markets or countries will have pipes with UPI for cross-border transactions.

The Second Coming

UPI has set significantly high standards in terms of growth of digital payments and therefore the dream of achieving 100 billion transactions a month does not sound like a pipe dream. However, a combined formula of time plus faster innovation will only take India closer to this goal.

"UPI123 Pay for feature phones is going to play a key enabler of this vision as it has the potential to unlock a huge market which does not use smartphones in the country. Further credit on UPI and international payments will also boost the transaction numbers," says Ayush Tripathi, programme manager, The Dialogue.

He further notes that NPCI also needs to improve its underlying infrastructure of UPI to ensure minimum downtimes and transaction failures. "Given the year on year growth of 55% and 10.58 billion transactions in August, the statistics show only upward trends. With right policy interventions and innovative and targeted solutions, the goal can be realised," he adds.

As per a report unveiled by Finance Minister, Nirmala Sitharaman, at the event today titled, 'The Second Wave - Resilient, Inclusive, Exponential Fintech', prepared by the Boston Consulting Group (BCG), digital payments are expected to exceed $520 billion by 2030. That is a jump from the current $120 billion in 2022.

Even so, the finance minister underscores the threats to the financial ecosystem, while saying, "We should be well seized of the threats and challenges, including physical border threats such as conventional warfare, cyber threats and attacks, crypto threats, drug and drug mafias, tax havens and tax evasions."

In this respect, she also appeals to the fintechs to invest heavily to protect the cyberthreats. She emphasises on the significant role the fintech industry needs to play in building a responsible, financial ecosystem.

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