UPI Apps Get a Handy Update: Here's How Your Transactions Are Changing!

Mumbai: UPI Apps Now Commonplace – Here's How They're Changing Your Daily Transactions!

UPI apps have become an everyday necessity. No matter what you purchase, a user now searches for it with the UPI app's scanning QR code. UPI apps are driving the majority of the country's UPI transactions. Therefore, it's the PhonePe, Google Pay, and Paytm apps that are prominently leading the market. This dominance is what UPI intends to change by promoting interoperability.

Now, UPI aims to introduce a mechanism where individuals won't need a specific mobile application to conduct UPI transactions, eliminating the need for installing various apps. This is the method that will be introduced in the coming days to promote UPI transactions. Some apps have already entered this space. PhonePe's Chief Technology Officer, Rahul Charie, has penned a blog about it.

UPI's 'Plug-ins' or 'Merchant Software Development Kits (SDKs)' are capable of doing this. Through these SDKs, businesses can create a virtual payment address without using any specific payment application and facilitate payments directly to users without the need for them to install separate payment applications. It's seen as an essential feature to increase UPI adoption in the country.

This feature will also save time as UPI transactions are currently going through a lengthy process involving multiple apps. When you scan a merchant's QR code while shopping, the payment will now directly go to the recipient's app. This will reduce waiting times for consumers and, in some cases, prevent them altogether. For those buying train tickets on IRCTC, this experience is already in place.

This is what the new UPI 'Plug-ins' aim to achieve. By making such features available, UPI transactions' efficiency will increase by over 15%, according to NPCI.

At the same time, UPI transactions in August accounted for 57% of the total transactions in the retail space. In online shopping, UPI transactions accounted for 60%. Thus, the UPI plugin is playing a significant role in increasing the market share of UPI apps. By introducing this new plugin, the process for UPI transactions will change significantly. This should be seen as a significant step by NPCI to further increase the adoption of UPI apps in the country.

In August, UPI transactions accounted for 57% of all retail transactions. In online shopping, it was 60%. The majority of these UPI transactions occurred through the apps PhonePe, Google Pay, and Paytm, with the PhonePe app leading with a 30% market share. The plugin is a part of PhonePe's strategy to grow by over 30% by making UPI transactions more efficient.

At the same time, PhonePe has 33% of the market share for its merchant app. Paytm is third with 13%. So, PhonePe and Google Pay lead in these apps' market share, with the latter trying to catch up.

Overall, the market share of UPI apps in India continues to grow. Looking at the market share of UPI apps, PhonePe is leading the way at 47%, with PhonePe following closely behind at 33%. Paytm is third with 13%