India’s UPI transactions break 700 million mark in 1 day for first time

New Delhi: India’s Unified Payments Interface (UPI) achieved a major milestone on August 2, crossing 707 million transactions in a single day — the first time ever that daily UPI volume exceeded 700 million, according to the latest data from the National Payments Corporation of India (NPCI).

While the pace of growth has moderated, daily UPI transactions have doubled over the past two years:

• August 2023: around 350 million transactions per day
• August 2024: reached 500 million per day

The government has set an ambitious target of 100 crore daily UPI transactions. Analysts believe this goal is achievable by next year, if current growth trends continue.

However, fintech firms and payment associations suggest that reintroducing Merchant Discount Rates (MDR) would help reach this milestone. They propose establishing marginal MDRs for large merchants and high-value payments.

Debate over MDR and financial sustainability

The government has cut UPI subsidies from Rs 4,500 crore in FY24 to Rs 1,500 crore in FY25, but has refused to accept MDR reinstatement demands. The Reserve Bank of India, however, has backed calls for MDR to ensure UPI’s long-term viability. “Costs will have to be paid. Someone will have to bear the cost,” said RBI Governor Sanjay Malhotra, emphasising that UPI should become financially sustainable.

Currently, UPI remains free for users, with operational costs covered by subsidies support­ing banks and infrastructure providers.

UPI now processes daily volumes larger than many global payment systems. In July, it recorded nearly 19.5 billion transactions totaling over Rs 25 lakh crore, averaging roughly 650 million transactions and Rs 83,000 crore in value per day.

UPI now handles around 85 percent of all digital payments in India and nearly half of real-time digital payments globally.

With increased internet access and rising digital adoption, UPI continues to grow at 5–7 percent per month, translating to approximately 40 percent yearly growth.

With IANS inputs