PhonePe, the Indian digital payments and financial services platform drove a cumulative 6.63 billion transactions in the fourth quarter of the calendar year 2021, a 26 percent quarter-on-quarter (QoQ) jump. In addition, the total payments value (TPV) of transactions processed on the application grew to $155 billion.
TPV refers to the total value of payments and reversals executed on a payments platform. According to the report, Q4 saw a rapid growth in the number of registered users as well as the transactions on the platform contributing to a spike in TPV, registering a 26 percent QoQ rise.
Maharashtra became the first state to cross 1 billion transactions in a quarter, with Pune accounting for 38 percent of overall transactions from the state. At a close second, Karnataka showed 24 percent QoQ growth, driving 932 million transactions.
PhonePe starts Rs 999 health insurance aimed at young first-time buyers
In addition, Goa with an increase of 71 percent, Andaman with 41 percent, and Assam with 37 percent were the top three states and union territories in terms of QoQ transaction growth. Interestingly, 37 percent of all transactions after six in the evening, on the PhonePe application, were reported from food and beverage stores.
With the festive season and multiple e-commerce sales in Q4, online and offline merchant transactions jumped, and the category drove the highest transaction volume. During the quarter, the merchant category accounted for 3.15 billion transactions out of an overall 6.63 billion.
Karthik Raghupathy, Head of Strategy and Investor Relations at PhonePe said, “As predicted in our Q3 report, we saw the merchant transactions register robust QoQ growth driven by the holiday season, festivities, and multiple e-commerce shopping sales.”
While the online merchant transactions category saw 32 percent QoQ growth hitting 655 million transactions, the positive trend witnessed in offline transactions was driven by customer demand for contactless payments and the steady digitisation of offline merchants. As many as 25 million merchants were digitised across 15,700 towns and villages in India leading to the mix of rural merchants increasing to 33 percent in 2021, up from 25 percent in 2020.
These are some of the granular insights from PhonePe’s report on digital payments on its platform, based on PhonePe's user base, announced on January 28.
PhonePe dominates UPI transactions with a 46 percent market share. This has given fintech the confidence to share data, insights, and trends on digital payments in the country through a quarterly report. The company says with its market share, this data is representative of India's digital payment habits.
According to the report, with the third wave of the pandemic, the company is expecting to see a surge in volumes for Q1 2022 across use cases like money transfers, recharges, bill pay as well as payments made for buying essentials like food, grocery, medicines, online doctor consultations, etc.
Launched in September 2021, PhonePe Pulse is India’s first interactive website with data, insights, and trends on digital payments in the country.