Digital payments continue to surge in India, led by the United Payments Interface (UPI), according to data by digital payments and financial services player PhonePe’s second edition of the Pulse report for the third quarter of 2021.
Total Payments Value (TPV) saw a 23.3 percent quarter-on-quarter (QoQ) growth to Rs 921,675 crore and the number of transactions grew by 33.6 percent from Rs 394 crore in Q2 to 526.4 crore in Q3.
The report is based on PhonePe’s 32-crore user base and their digital transaction habits. The company dominates the UPI payments space with a 45 percent share in monthly volumes and 47 percent share of the value of payments. PhonePe also has a 49 percent share of monthly Bharat BillPay volumes.
Based on its market size, the Walmart-backed company commenced the sharing of data insights through its Pulse report last quarter. PhonePe Founder and CEO Sameer Nigam believes that with its majority share in the payments space, the data is reflective of overall user behaviour in India.
Offline merchant payments at physical stores have grown by 65 percent over the previous quarter. In a clear indicator of recovery after the second wave of the pandemic, and stores rapidly opening up, nearly four out of five merchant payments are now offline payment transactions, the report said.
With the economic activities returning to normalcy spurred by festive shopping, money transfers through UPI and overall merchant payments hit new milestones in the quarter, clocking in 221 crore and 231 crore transactions, respectively.
The data for Q3 suggests that new users are moving towards digital payments as the company witnessed a 7.5 percent growth in its registered user base from 30.5 crore to 32.8 crore.
“The rapid growth we are seeing quarter-on-quarter is a strong indicator that digital payments are truly penetrating across the length and breadth of the country. It is going to be an exciting next quarter with the festivities and the holiday season, we are looking forward to interesting insights and trends from Q4 2021,” Karthik Raghupathy, Head of Strategy and Investor Relations at PhonePe, said.
Chandigarh saw the highest growth in digital payments of 50 percent QoQ, followed by Karnataka and Maharashtra at 40 percent. Washim district in Maharashtra saw the highest QoQ growth in transactions at over 75 percent.
The report also said that Xiaomi continued to be the most preferred smartphone brand with 25 percent of PhonePe’s user base using Mi phones, followed by Vivo at 20 percent.
Headquartered in Bengaluru, PhonePe was founded in in 2015 by former Flipkart executives Sameer Nigam, Rahul Chari, and Burzin Engineer. The company forayed into financial services in 2017 with a gold purchasing and investment platform and later expanded into insurance and mutual fund services.
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