As the ill-effects of demonetization fade away, the country is getting back to using cash for daily transactions — something that was previously also replaced with some digital mode of payment. This shift is quite evident in RBI’s newest provisional data released on Tuesday.
According to RBI’s report, the country witnessed only a slight increase in the value of digital transactions in May as compared to the previous month. We witnessed total digital transactions worth ₹111.09 trillion, a rather minuscule 1.4 percent increase in value over the last month’s ₹109.60 trillion, reports LiveMint.
While the valuation increased, the number of digital transactions declined to 851.1 million from the modestly higher 853.1 million figure in April. The highest volume of transactions was recorded at 957.5 million, back in December.
And if you’ve been thinking that the total count of digital transactions only involves online wallets, then sadly you’re mistaken. It also includes credit and debit cards, unified payments interface (UPI), unstructured supplementary service data (USSD), prepaid payment instruments (PPIs), Internet and mobile banking. Let’s take a brief look at the breakdown of the number of transactions conducted via each platform.
The number of UPI transactions achieved a new high, 9.2 million, in April as compared to the previous 6.9 million in March. The value of these transactions witnessed an increase of around 26 percent from ₹22 billion last month to ₹27.7 billion in May. USSD also witnessed a decent 2 percent and 5 percent uptick in both value and volume, as compared to the last month. Other modes of digital payment transfer also witnessed a surge in their numbers.
This boost in digital transactions has been provided by Modi government’s efforts, who has been aggressively pushing the people towards a cashless economy. National Payments Corporation of India (NPCI) launched a UPI-enabled BHIM (Bharat Interface for Money) app for Android towards the end of last year. It has since been downloaded over 20 million times and found its way to iOS devices.
The preference of UPI and Paytm payments, which is now a fully-functional bank, has grown over the past few months. While the former is integrating Aadhaar into the payments systems to further simplify the payment completion process, the latter saw huge upticks across all of its major analytical figures. This has helped drive the country towards a more digitized and cashless economy, which is one of the primary goals of the current administration.