While the Unified Payments Interface (UPI) may not be witnessing exponential growth like earlier, it continues to add two million users per month, Dilip Asbe, managing director and CEO, National Payments Corporation of India (NPCI), told Shritama Bose during an interview.
While the Unified Payments Interface (UPI) may not be witnessing exponential growth like earlier, it continues to add two million users per month, Dilip Asbe, managing director and CEO, National Payments Corporation of India (NPCI), told Shritama Bose during an interview. Excerpts:
In recent months, UPI has been growing around 6-7% month-on-month compared with an exponential growth earlier. Would you say growth in this channel has plateaued and has already garnered most of the users it could have?
Naturally, as the base increases the rate of growth may stabilise, like any other product. However, till the time value increases steadily, we are good. Now, the whole objective of BHIM UPI is how to build more and more use cases and our work is focusing on that. One use case is to get UPI to be accepted by all online merchants. The second and more important thing is that we are working with banks and many third-party acquirers to push the BHIM QR-based offline merchant enablement.
We are also working with start-ups to create innovative use cases like credit card bills payment and split bills because that’s a popular demand from youngsters. And, while the growth has slowed down, the number of users coming to BHIM UPI on a month-on-month basis has been steadily growing, which is a great sign. It’s all about education and awareness; once this is addressed we may see further scale up on BHIM UPI.
The low-hanging fruit here are the online merchants, but what’s the plan for bringing the offline merchants on board?
Offline acquiring is tough because the banks and third-party players have to invest money to acquire a merchant and train them. It’s a demand-and-supply situation, where a consumer should be willing to pay through this mode and the same merchant should be enabled. So, success on the offline side is still some time away for us. But as I said, that is a focus area for us.
For a few months after BHIM was launched, it accounted for the largest share of UPI transactions, most of which were peer-to-peer (P2P) transactions. More recently, it has conceded that space in P2P to other apps. Is it doing better in merchant payments?
No, we don’t look at it that way. The objective was never to launch one app and get everybody on that app. The objective was to create a BHIM UPI app ecosystem and we should have hundreds of apps available to the consumer. So, every UPI app (bank and non-bank) is now being called BHIM UPI app. Initially, when BHIM started, it was one of the few, but now when there are so many apps, the volumes get distributed and this is what we envisaged.
Every app brings its own innovation and that’s how you get new features rolled out. UPI is too nascent a space to compute market share at this point. And also, BHIM app transactions are growing continuously and there has not been a drop of volume anytime.
What is the deadline for complying with all UPI requirements?
We put out a circular saying April 16 is the deadline and most of the apps are compliant. So, there is a fully interoperable system already in place.
When can Amazon be expected to launch UPI payments?
They have already made their website (marketplace) enabled for UPI-based payments. I have been given to understand they are working on this.
When Bharat QR was launched last year, we were told that one million merchants will be on-boarded by the end of 2017. Has that happened?
QR is in its early days and new systems like this will take some time to settle in. Currently, merchants are being on-boarded on Bharat QR and BHIM QR, but change in consumer behaviour takes time. Consumers have been used to making merchant payments using cards. Now, there are new methods where we are asking them to scan the QR code.
What is your stand on the demand for ATM interchange to be raised?
That’s a pending decision as of now. ATM growth has been low and obviously, there is a concern on the cost side. Both sides of the arguments keep coming to NPCI, but finally, we would want banks to arrive at a consensus while taking a decision.