UPI Success Rate Crumbles As Transactions Soar To 2.2 Billion In 30 Days; More Transactions Are Failing Now
The month of December has barely started and a spike has already been observed in the failure rate of digital transactions marking a bad time for the Indian banking and digital payments industry.
Several complaints have started coming in from customers who have opted for online transactions.
Multiple Customers Complaint About Failure Of UPI Transactions
We already know that the coronavirus situation and to social distancing that the virus demands has resulted in people preferring to make their payments online.
However, as revealed by industry sources, there have been multiple complaints about the failure of transactions on the Unified Payments Interface (UPI) and other payment methods. Apparently, the bank service and back-end systems are to be blamed for these failures in transactions.
A top banker has said that the extreme jump in digital payments was unexpected, taking into consideration the situation created due to COVID-19, and the industry was never prepared for this unanticipated increase. As per this source, the capacity of the servers is not strong enough to take the load.
UPI Has Become Bigger Than Bank Transactions?
In October 2020, as many as 2.2 billion UPI transactions were processed by the NPCI or National Payments Corporation of India. These transactions have been worth Rs 3.9 lakh crore. This was clearly due to people switching to digital payments so as to avoid being infected from the virus, which spreads from socializing.
This number has accounted only for 83% of the total growth in less than six months. In May 2020, there were about 1.2 billion UPI transactions. The number of debit card transactions at merchant outlets are 352 million, whereas the number of transactions through credit cards was 149 million.
The banker quoted above also revealed, “UPI has become so much bigger than card transactions that banks need to scale up their back ends to support this growth.”
Recently, NPCI or National Payments Corporation of India has imposed a cap of 30% on every app. As per the notifications on 30% cap issued by NPCI, it’s clear that the transactions are done on existing UPI apps such as PhonePe, Google Pay, Paytm, and others won’t fail.