E-payments continue to decline in volumes despite rise in value

RPT—Balurghat: A person pays his bill at a tea stall using Paytm app at Balurghat in South Dinajpur on Saturday. PTI Photo(PTI12_3_2016_000055B)

Electronic payments continue to show a decline in volumes despite increase in overall value of transactions. According to the latest data of the Reserve Bank of India (RBI) the total volume of electronic transactions has declined from a peak of 957.5 million in December to 707.9 million in March. However, the overall value of transactions is Rs 105.6 lakh crore, the highest in the last five months despite only 26 days data for March.
According to bankers, the increase in value of electronic transactions is due to tax payments by large corporates
in March. “There is  little decline in the number of electronic payments, however, in March the value of the transactions are up due to tax payments by big companies,” said Manju Agarwal, deputy managing director at State Bank of India (SBI).

While debit and credit card usage have shown a decline in both value and volume since the highs of December (note that this is representative data from the four top banks), Unified Payments Interface transactions are steadily improving. From almost nothing in November, UPI transactions have climbed to 4.9 million in the 26 days of March for a total Rs 1970 crore worth transactions. The big increase has come in RTGS transactions which have jumped from Rs 74.2 lakh crore in February to Rs 86.45 lakh crore in March with five days of data yet to come. Volumes of RTGS too have increased to 9.3 million, the highest in five months. With currency in circulation at around 70 per cent of pre-demonetisation levels, the use of mobile wallets has come down. While data for the last 5 days of March is yet to come, both value and volume have come down from peak levels in December and January.

Agarwal said the current levels of electronic payments are still very high from what it was before demonetisation. According to her, after demonetisation, transactions using debit cards have increased  from 40 lakh as against 22 lakh before demonetisation.  The value of such transactions have also jumped to Rs 370 crore from Rs 172 crore in the same  period. The number of transactions using point of sale (PoS) machines have also jumped from 3.5 lakh to one million in this period.