Retail payment channels indicate upswing in June transactions over May
UPI transactions increased 13 percent in volume terms to 1.74 billion and in value terms by 11 percent to Rs 3.87 lakh crore.
Most of the payment channels used for making retail payments saw a rise in the volume and value of transactions in the first 21 days of June, as compared to the same period in May. The easing of lockdowns and other restrictions in June may be helping to boost consumption and payment transactions, analysts said.
According to data released by the Reserve Bank of India (RBI), the transactions made through Immediate Payment System (IMPS), Unified Payments Interface (UPI), debit and credit cards as also cash withdrawals increased in June over May.
In April and May, the various payment channels had recorded month-on-month declines in transaction volumes because of lockdowns across states and the onslaught of the second wave of COVID-19.
UPI transactions increased 13 percent in volume terms to 1.74 billion and in value terms by 11 percent to Rs 3.87 lakh crore. IMPS volumes rose 7.6 percent in volume terms to 211.21 million and 4.65 percent in value terms to Rs 1.97 lakh crore. Credit card usage rose 18.6 percent to record 78.3 million transactions in June while debit card swipes rose 12.8 percent month-on-month to 164.05 million.
The second COVID-19 wave had also hit consumer sentiment badly. The survey of consumer confidence conducted by the RBI in the last week of April and up to May 10 in 13 major cities revealed that consumer confidence fell to a new all-time low in May 2021.
Yet, the fallout of the 2021 COVID-19 wave was better than that of the first one in 2020, PayU India said in a report on 22 June. Year on year, there has been a 52 percent increase in the number of transactions and a 76 percent increase in expenditure between May 2020 and May 2021, PayU India said.
Analysts have seen the improvement in payments data in June as a sign of pick-up in consumption. In a report dated 22 June, ICICI Securities said that the payment snapshot available for the year so far indicates that the impact of the second COVID-19 wave has been significantly less than that of the first.