UPI will handle 90% of retail digital payments by 2026–2027: PwC India

UPI transactions are forecast to grow steadily and reach 1 billion per day by 2026–2027, making up 90% of all retail digital payments in the nation, according to a PwC India estimate.

The PwC research titled "The Indian Payments Handbook - 2022-27" stated that the Unified Payments Interface (UPI), which is leading the digital payments revolution, accounted for nearly 75% of the overall transaction volume in the retail industry during 2022–23.

According to the report, over the next five years, UPI is expected to handle 90% of all retail digital payment transactions.

According to the report, the Indian digital payments market expanded steadily at a CAGR of 50% (volume-wise) and is predicted to increase to 411 billion transactions in FY 2026–27 from 103 billion in FY 2022–23.

By FY2026–2027, it is predicted that UPI will record 1 billion transactions every day, up from 83.71 billion in 2022–2023 to 379 billion in 2026–2027.

It added that, after UPI, cards (both debit and credit) payments are one of the most popular retail digital payment methods, and the credit card market in particular, is still expanding at a strong rate. By FY 2024–2025, credit card usage is anticipated to outpace debit card usage in terms of transaction volume.

According to the PwC estimate, the credit card industry would generate close to 76% of all card sales in 2022–2023, making it a lucrative market for banks, NBFCs, and FinTech.

According to the report, the revenue from credit card issuance climbed by 42% in 2022–2023 compared to 2021–2022 and is anticipated to expand by a CAGR of 33% over the following five years.