UPI Transactions Decline 5% MoM in February

SUMMARY

The decline in UPI transactions broke the streak of record-high transactions seen in the previous two consecutive months

According to data released by the NPCI, the total amount of the UPI transactions declined 6.47% in February to INR 21.96 Lakh Cr from INR 23.48 Lakh Cr in January

However, the average daily transaction count rose to 575 Mn in the month under consideration, up from 548 Mn in January

The Unified Payments Interface (UPI) transactions dropped over 5% month-on-month (MoM) to 16.11 Bn in February from 16.99 Bn in the preceding month and 3.7% from 16.73 Bn in December 2024.

The decline in UPI transactions broke the streak of record-high transactions seen in the previous two consecutive months.

However, on a year-on-year (YoY) basis, the transaction count surged 33% in February.

According to data released by the National Payments Corporation of India (NPCI), the total amount of the UPI transactions declined 6.47% in the month under consideration to INR 21.96 Lakh Cr from INR 23.48 Lakh Cr in January. On a yearly basis, the total transaction amount increased 20% in the month of February.

On a daily basis, the transactions count as well as value increased in February.

The average daily transaction count rose to 575 Mn in the month under consideration, up from 548 Mn in January. The average daily transaction amount increased 3.56% to INR 78,446 Cr in February from INR 75,743 Cr last month.

In 2024, UPI transactions surged almost 46% to a record 17,220 Cr from 11,768 Cr in 2023. The surge in UPI came on the back of increasing popularity of fintech apps including PhonePe, Paytm, CRED, among others that made UPI payments convenient.

According to the Payments System Report 2024 by the Reserve Bank of India (RBI), out of 20,787 Cr digital payments recorded during the year, 17,221 Cr transactions were routed through UPI.

It is projected by the RBI, that the UPI transactions will soon hit the 1 Bn mark per day.

Maintaining its lead in the UPI ecosystem, fintech major PhonePe processed 810.2 Cr transactions in January 2025. The fintech giant accounted for more than 48% of the total UPI transactions in January.

Google Pay held on to the second position last month with a market share of 36.91%. Vijay Shekhar Sharma-led Paytm retained the third position, but its market share continued to decline. Paytm’s share in UPI transactions dipped to 6.87% in January from 6.97% in December 2024 and 7.03% in November 2024.

In December last year, NPCI extended the deadline for implementing a 30% cap on the market share of third-party app providers (TPAPs), such as PhonePe and Google Pay, by another two years. The proposal was initially made in November 2020 to prevent market dominance by any single player, the NPCI plans to cap the market share of TPAPs to 30%.

Notably, PhonePe and Google Pay dominate the UPI payments landscape and currently have more than 30% market share each.