India’s UPI transactions grow 57% YoY in FY24

Unified Payments Interface transactions, popularly known as UPI, grew by 57 per cent year on year (YoY) in India during the fiscal year 2023-’24, or FY24, the Boston Consulting Group Banking Sector Roundup FY24 has revealed.

The roundup report, which did a comprehensive analysis of growth in India’s economy and banking sector, also showed that the banking sector continues with its strong rate of growth and India’s economic growth for FY24 surged at 8.2 per cent YoY.

PHONEPE, GOOGLE PAY LEAD RACE

While on phone payment apps, the report pointed out PhonePe and Google Pay are currently leaders in this segment, together accounting for a market share of nearly 86 per cent. Compared to UPI transactions, the use of debit cards saw a YoY drop of 43 per cent although credit card payments have grown twice over the last three years.

BANKING SECTOR GROWTH IS ON

The banking sector continued with its strong rate of growth and its overall net profit surpassed Rs 3 lakh crore during the fiscal year 2023-’24, according to the report of the Boston Consulting Group Banking Sector Roundup. Public sector banks performed exceptionally, seeing a YoY surge of 34 per cent in net profit. Private banks saw YoY a net profit growth at 25 per cent.

Credit growth of the banking sector increased at 15 per cent while deposit growth saw a hike at 13 per cent in FY24. All bank groups scored more than 1 per cent Return On Assets (ROA), which highlights profitability of the banking sector, the report of the roundup said. Asset Quality improved, the report claimed, and Gross Non-Performing Assets, or GNPA, hit 2.8 per cent — the lowest figure in 10 years.

The banking sector remains well-capitalised, the report said. As many as 33 out of 35 banks have a Capital to Risk-weighted Assets Ratio (CRAR) of more than 15 per cent, which is more than the regulatory demand of 9 per cent.

ECONOMY RISING

India’s economic growth for FY24 crossed estimates, surging at 8.2 per cent YoY, although the report predicted growth in FY25 to remain around 6.2-7 per cent.