While the Unified Payment Interface (UPI) has been seeing sound growth in terms of transaction volume and value from the very beginning, the government’s flagship BHIM payment app has fallen behind.
Soon after its launch in December last year, the Bharat Interface for Money (BHIM) app held as much as 41 percent share of the total transactions using UPI. But its share has seen a steep fall recently with a 9.9 percent share in October this year and hitting a low of 7.8 percent in November, as per National Payments Corporation of India (NPCI) data.
The UPI transaction volumes -- where apps other than BHIM were also on board -- recorded around 150 percent rise in October and hit a high of 7 crore transactions. It went further up the following month and registered over 10 crore transactions in November.
While value of transactions on the UPI platform more than tripled to Rs 9,679 crore in 6 months till November, the value of BHIM transactions did not even double in the same period and rose from Rs 1,486 crore to only Rs 2,553 crore.
The popularity of UPI is not expected to decline any time soon and many see immense potential in the technology.
“UPI is a system that powers multiple bank accounts into a single-mobile application, merging several banking features, seamless fund routing and merchant payments into one hood. It also caters to the “Peer to Peer” collect request which can be scheduled and paid as per requirement and convenience,” as per the NPCI.
A senior developer at BookMyShow said that UPI solves a major pain point of users.
"UPI allows one to digitally transfer money without divulging his account details. One does not have to remember multiple username and passwords for multiple bank accounts,” he said.
In any case, the number of transactions or the amount transacted has not gone down for BHIM, but other players in the fray, such as bank apps, Google Tez and Phone Pe, have eaten up its share.
PhonePe said it had seen a 100 percent growth in May, with a total of 55 lakh overall transactions. They said in a blog-post that UPI was used in 70 percent of their total transactions.
The blog-post quoted PhonePe CEO Sameer Nigam as saying, “Our total merchant transactions grew 400 percent by value in May on the back of a highly successful Big 10 sale on Flipkart, making us the largest contributor to UPI merchant transactions, ahead of BHIM and all other UPI based apps.““One of the possible reasons why BHIM's popularity is decreasing is because at the time when BHIM first came, many banks did not have UPI integrated into their apps. Now almost all of them do. So users may be moving back to their bank apps,” said Bookmyshow developer.