UPI Credit Transactions Reach Rs 10,000 Crore Monthly, Reveals NPCI

The National Payments Corporation of India (NPCI) is experiencing a significant increase in transactions through its UPI platform's credit feature, with approximately Rs 10,000 crore being transacted monthly, according to CEO and Managing Director Dilip Asbe. The majority of these transactions stem from the credit card feature, which was introduced in November 2022. Users can link their credit cards to the app, accumulating payments into their monthly credit card bill.

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Growth in Pre-Sanctioned Credit Lines

Asbe highlighted that pre-sanctioned credit lines on UPI are also gaining popularity, with up to Rs 200 crore disbursed monthly. ICICI Bank leads in offering pre-sanctioned credit limits on UPI, and about six other banks have started providing this facility to their customers. This development comes amid concerns over the rapid growth of unsecured loans, including credit cards and personal loans.

Unified Payments Interface (UPI) is a widely used platform that recorded 466 million transactions in July. Asbe mentioned that UPI is witnessing substantial growth and is poised for the next phase of expansion. He clarified that the central bank digital currency (CBDC) aims not to compete with UPI but to offer features like programmability that will benefit India.

Fintech Industry and Regulatory Trust Deficit

Former RBI executive director G Padmanabhan, speaking at the same event, noted a trust deficit between the fintech industry and regulators. He expressed hope that the fintech sector would discuss ways to meet regulatory requirements during the three-day Global Fintech Fest. A survey conducted by a consultancy firm revealed that less than a third of fintech respondents feel aligned with highly regulated players on governance aspects, a slight increase from 27% last year.

The event organisers announced that Finance Minister Nirmala Sitharaman, RBI Governor Shaktikanta Das, Sebi Chairperson Madhabi Puri Buch, and other dignitaries would speak at the event held at Bandra Kurla Complex business district. Prime Minister Narendra Modi recently expressed his ambition to make Mumbai the global fintech capital. Mumbai has long been India's financial hub, while Gujarat hosts the country's only International Financial Services Centre.

Focus on Digital Currencies

Padmanabhan mentioned that discussions on digital currencies would focus on CBDC without calling for a re-evaluation of RBI's stance on cryptocurrencies like Bitcoin. The three-day event will feature 350 sessions, 20 reports, 800 speakers including 150 women, and attract 80,000 attendees from over 25 central banks worldwide.

Infosys co-founder Krish Gopalakrishnan, associated with the event, stated that networking and investor connections would be key focus areas. Over 300 investors are expected to attend, enhancing opportunities for collaboration and investment in the fintech sector.

The NPCI's initiatives reflect India's dynamic financial landscape and its readiness for further technological advancements in payments and digital currencies.