India’s Digital Payment Boom: UPI Transactions Surge 31% to Rs 130 Lakh Crore

India is witnessing an unprecedented surge in mobile payments, with transaction values soaring nearly 30% year-on-year (y-o-y) to approximately ₹198 lakh crore (₹1.98 trillion) in the second half (2H) of 2024. This figure is 14.5 times the amount spent via credit and debit cards combined, highlighting the dominance of mobile-based transactions.

The surge is primarily fueled by Unified Payments Interface (UPI) transactions, which saw a 31% y-o-y increase in value, reaching around ₹130 lakh crore. The expansion of digital payment infrastructure has played a crucial role, with UPI QR codes—a key enabler of mobile transactions—rising to 63.34 crore by the end of December 2024, according to data from leading payments technology firm Worldline.

“Mobile payments have become the go-to channel, with transactions surging 41% y-o-y to 88.54 billion (8854 crore), underscoring the role of smartphones in India’s financial ecosystem,” Worldline stated. Ramesh Narasimhan, CEO of Worldline India, added, “UPI continues to lead India’s digital revolution, with transaction volumes growing 42% y-o-y, reaching 93.23 billion (9323 crore) transactions in 2H 2024.”

The role of UPI in everyday micro-transactions is evident, with Person-to-Merchant (P2M) transactions rising 50% y-o-y. However, the average ticket size (ATS) of UPI transactions dropped from ₹1515 in 2H 2023 to ₹1396 in 2H 2024—an 8% decline. Similarly, the ATS for P2M transactions decreased by 4.7%, from ₹657 to ₹626.

“This continued decline in P2M ATS signifies how UPI has become the preferred mode for micro-transactions, reinforcing its long-term sustainability. If median transaction values were publicly available, anecdotal evidence suggests a significant portion of transactions are ₹100 or less,” Worldline noted.

UPI transactions are divided into Person-to-Person (P2P) and P2M categories. Data shows the value of P2M transactions surged 43% y-o-y to ₹36.35 lakh crore, while P2P transactions grew 26% to ₹93.84 lakh crore. In volume terms, P2M transactions increased 50% to 5803 crore, and P2P transactions rose 30% to 3521 crore.

Three UPI apps—PhonePe, Google Pay, and Paytm—continue to dominate the market, collectively handling 93% of all UPI transactions by volume and 92% by value as of December 2024.

While card transactions also witnessed growth, their volume remains significantly lower than UPI. In 2H 2024, total card transactions reached 410 crore, an 11% rise from 2H 2023. However, debit card usage fell sharply, with transactions declining 29% y-o-y to 82 crore. In contrast, credit card transactions surged 36% y-o-y to 242 crore.

The total value of card transactions in 2H 2024 stood at ₹13.64 lakh crore, marking an 8% increase. This growth was primarily driven by credit cards, with transaction values rising 14% y-o-y to ₹10.76 lakh crore, while debit card transaction values fell 16% y-o-y to ₹2.55 lakh crore.

“India’s digital payments landscape continues to experience significant growth, as reflected in the data from the second half of 2024. UPI remains the dominant force, while credit card transactions have also shown robust growth, particularly in high-value payments,” stated Worldline in its India Digital Payments Report.

“As these trends unfold, digital payments will become even more embedded in India’s economic framework, fostering greater financial inclusion and accelerating economic growth across all segments of society,” Worldline added.

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