For the month of April, PhonePe led the UPI market with close to 49 per cent share across P2M (person to merchant) and P2P (person to person) transactions….reports Asian Lite News
As digital payment platforms, PhonePe and Google Pay, continue to have a duopoly in the Unified Payments Interface (UPI) market, the deadline by the National Payments Corporation of India (NPCI) to implement a 30 per cent market share cap on UPI services providers inches closer. Will NPCI implement or extend the deadline?
For the month of April, PhonePe led the UPI market with close to 49 per cent share across P2M (person to merchant) and P2P (person to person) transactions.
The company has maintained the top position in UPI transactions since November 2020.
On the other hand, Google Pay clocked 38 per cent UPI market share in April.
Meanwhile, Paytm’s market share in the UPI ecosystem came down to 8.4 per cent in April, a third consecutive drop for the fintech major every month.
To control such dominance by a few players in the UPI ecosystem, the NPCI had, in 2022, proposed the 30 per cent market share cap for UPI payment apps.
Back then, existing players were asked to restrict their market share to the mentioned limit within two years.
However, the market cap deadline was never implemented and the deadline to introduce the limit is December this year.
According to experts, the NPCI will review the UPI deadline by the end of this year and is most likely going to extend the deadline.
It is also “highly unlikely” that either the Reserve Bank of India (RBI) or the Ministry of Finance will advise the NPCI to issue a circular to enforce the market cap.
“Such a circular would likely face legal challenges and may not hold up in court,” they said.
When reached, NPCI did not immediately comment.
Meanwhile, RBI Governor Shaktikanta Das on Wednesday held a meeting with major stakeholders in the UPI ecosystem including banks, National Payments Corporation of India (NPCI), third party application providers and technology service providers during which potential strategies for further expanding the reach of UPI were discussed.
“The various suggestions received will be examined, and suitable action will be initiated in due course,” the RBI said.
There were wide-ranging discussions on various aspects to widen and deepen the adoption and usage of UPI at the meeting which was also attended by Deputy Governor T. Rabi Sankar along with senior officials of RBI.
The stakeholders shared their suggestions on strategies for scaling up of UPI infrastructure and expanding the products portfolio. The challenges being encountered by the ecosystem and innovative solutions for addressing them came up during the discussion, according to a RBI statement.
There was also brainstorming on innovative ideas to integrate potential users into the digital payments ecosystem.
ALSO READ: Google Unveils Pixel 8a in India