The unified payments interface (UPI) in India, while touted as “fantastic at many levels,” is increasingly viewed as an “incredibly painful experience” for ecosystem participants, as per Mastercard’s Chief Financial Officer, Sachin Mehra.
At the recent UBS conference, Mehra raised concerns about the sustainability of UPI, shedding light on the financial struggles faced by banks and other players involved in the ecosystem.
The UPI Dilemma
Mehra acknowledged that UPI has its merits but pointed out the financial challenges it poses for participants.
Banks facilitating UPI transactions often find themselves on the losing end financially, making it a pressing question of long-term sustainability.
The pain points experienced by ecosystem participants have raised significant doubts about the future of this payment system.
Record-Breaking Transaction Numbers
Amidst these concerns, UPI achieved a remarkable milestone in August, with 10 billion transactions.
In September, it further surged to 10.56 billion transactions, accompanied by a slight increase in total transaction value.
The National Payments Corporation of India (NPCI) reported a 56% rise in volume and a 41% increase in value compared to the previous year.
The Digital Payment Trend
Despite the challenges, digital payment methods, including UPI, are on the ascent in India.
Reports indicate that 42% of consumers plan to opt for UPI for their online shopping during the upcoming festive season.
This underscores the growing popularity of digital payments in the country.
Read all the Latest News, Sports News, Entertainment News, Fashion, Tech News and Viral Videos here. Also Follow us on Google News and Twitter.
