The digital payments system in India has grown significantly in recent years. Every neighbourhood kirana store now has a QR code scanner. Has the United Payments Interface (UPI) revolutionised how Indians carry out economic transactions? Has the popularity and ease of digital transactions brought about financial inclusion across the country? Where does India stand vis-à-vis other countries?
Modes of payment
Since the introduction of UPI in 2016, transactions in this mode have grown in value and volume. It has been well documented that demonetisation in November 2016 and the COVID-19 lockdown in 2020 were major push factors for the widespread adoption of digital payments. From June 2021 to April 2023, UPI payments grew at an average monthly rate of 6%. The corresponding figures for NEFT, IMPS, and debit card payments were 3%, 3%, and 1.5%, respectively. This indicates that the popularity of UPI increased at a faster rate than all other modes of payment.
