UPI transactions increase 57% YoY in FY24; PhonePe and Google Pay lead

In a remarkable display of growth, Unified Payments Interface (UPI) transactions surged by 57% year-on-year (YoY) in FY24, as reported by Boston Consulting Group (BCG) in its Banking sector roundup. Leading the digital payments landscape, PhonePe and Google Pay collectively held an impressive 86% market share within the UPI segment.

Also Read: How to make UPI payments without an internet connection: A guide

The report highlighted a significant shift in digital payment preferences. Credit card transactions doubled over the past three years, while debit card transactions saw a notable decline of 43% YoY. This change reflects a broader trend towards credit-based digital transactions among consumers.

The Indian banking system demonstrated robust performance overall, maintaining strong momentum in credit growth, which surged by 15% in FY24. Deposit growth also remained solid at 13% for the same period.

Marking a historic achievement, the total net profit of the banking sector surpassed ₹3 lakh crore in FY24. This milestone was accompanied by all bank groups achieving a return on assets (ROA) greater than 1%, underscoring the sector's profitability. Key drivers of this success included high credit growth, healthy fee income growth, and low credit costs.

The BCG report underscores the dynamic nature of the Indian banking and digital payment sectors, highlighting significant shifts and robust growth that are reshaping the financial landscape.