India's digital payment ecosystem continued its explosive growth in the second half of 2024, driven significantly by mobile-based transactions and an ever-increasing preference for Unified Payments Interface (UPI) over traditional card methods.

According to the Worldline India Digital Payment Report, mobile transactions surged by a remarkable 30% year-on-year to touch ₹198 lakh crore, showcasing India’s rapid evolution into a mobile-first payment economy. This leap is more than 14.5 times the total money transacted using credit and debit cards combined during the same period.

UPI at the Forefront of India's Digital Payment Revolution

The UPI system, launched by the National Payments Corporation of India (NPCI), has become the cornerstone of India's payment infrastructure. As per the report, UPI transactions alone accounted for ₹130 lakh crore during the July-December 2024 period—a 31% rise compared to the same period in 2023.

A large part of this success is attributed to the widespread adoption of UPI QR codes, which saw deployment rise to a massive 63.34 crore by the end of December 2024. These QR codes have made it effortless for even small vendors in rural and urban India to accept digital payments, thereby deepening the reach of formal financial services.

Point-of-Sale Terminal Growth Hits New Milestone

In another significant development, the number of point-of-sale (POS) terminals in the country surpassed the 10 million mark, indicating how merchants are increasingly investing in digital infrastructure.

Interestingly, only 10 banks dominate this landscape, accounting for more than 96% of all POS deployments, highlighting the concentrated nature of infrastructure support in India’s payment network.

Shift in Payment Preferences: UPI Replaces Debit Cards for Daily Spends

The report reveals a crucial shift in consumer behaviour: debit card usage is on the decline, whereas UPI is now the preferred mode of transaction for daily payments. This transformation is also evident in the average ticket size of UPI transactions, which fell from ₹1,515 in 2023 to ₹1,396 in H2 2024. This dip clearly shows that UPI is being used for smaller, more frequent transactions, which were earlier done via cash or debit cards.

Meanwhile, credit cards continue to dominate in high-value spending, with consistent growth in both online and point-of-sale transactions. This suggests that consumers are leveraging credit cards for larger purchases while relying on UPI for smaller day-to-day transactions.

Top States with Highest Physical Payment Touchpoints

Geographically, the expansion of digital payments has not been limited to metro cities alone. States like Kerala, Maharashtra, Tamil Nadu, and Karnataka have emerged as the top regions in terms of physical payment touchpoints. This indicates strong regional penetration of digital infrastructure, setting a benchmark for other states.

These regions are reaping the benefits of strong banking networks, increased smartphone penetration, and local government initiatives that promote digital literacy and financial inclusion.

A Closer Look at Payment Instruments in H2 2024

• Mobile Payments: ₹198 lakh crore, 30% YoY growth

• UPI Transactions: ₹130 lakh crore, 31% YoY growth

• POS Terminal Deployments: Crossed 1 crore mark

• UPI QR Code Deployments: 63.34 crore

• Average UPI Ticket Size: Dropped to ₹1,396

• Credit Card Growth: Steady in both POS and online channels

• Debit Card Usage: Witnessing steady decline

Why Mobile and UPI Continue to Win

Several factors are fueling this digital payment boom:

• Government push towards a cashless economy

• Increased smartphone and internet penetration

• Improved financial literacy and trust in digital systems

• Interoperable platforms like UPI offering 24x7 instant transfers

The ecosystem around digital payments has matured, and ease of access, instant processing, and zero transaction cost (for most UPI transactions) are encouraging even small-scale businesses and consumers in rural areas to switch from cash to mobile-based payments.

Outlook: The Road Ahead for Digital Payments in India

As India gears up for the next phase of fintech innovation, the momentum in mobile and UPI transactions is likely to continue, supported by further innovations such as UPI Lite, credit on UPI, and international UPI acceptance.

Experts believe the future will see more personalization, deeper financial integration, and greater cybersecurity focus. The potential to replace even low-value cash transactions with digital options is already being realized, and India could become the global model for mobile-first payment systems.

Conclusion

The H2 2024 data confirms what has been evident over the past few years—India is leading the global transformation in digital payments, powered by UPI and mobile-first transactions. With declining reliance on debit cards, robust POS infrastructure, and rising credit card adoption for high-value spends, the country is reshaping how financial transactions are conducted.

This seismic shift from traditional to digital payment systems marks a crucial milestone in India’s journey toward becoming a truly digital economy.

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