India’s digital payments ecosystem witnessed robust growth in FY2024-25, with transaction volumes surging 34.8% year-on-year, according to the Reserve Bank of India’s latest annual report released this week.
The uptrend continues the strong momentum seen in FY24, which recorded a 44% rise.
In value terms, digital transactions grew 17.3% over the year, largely driven by Real Time Gross Settlement (RTGS) transactions, the report said. The total value of digital payments reached ₹2,862 lakh crore, up from ₹2,428.2 lakh crore in the previous fiscal.
Retail digital payments now account for 99.9% of all non-cash retail transactions, a slight increase from 99.8% the year before. The total number of retail digital transactions reached 2,222.9 crore, with a combined value of ₹919.3 lakh crore.
The Unified Payments Interface (UPI) continued to dominate the retail segment, clocking a 41.7% rise in transaction volume and a 30.3% increase in transaction value. UPI contributed 84% of all retail digital transactions by volume.
Other payment systems also posted notable growth like the RTGS transactions rose 12% in volume and 17.8% in value, reflecting the pace of large-value payments. Further, the NEFT usage increased 32.4% by volume and 13.4% by value.
The Payments Infrastructure Development Fund (PIDF), aimed at expanding digital payments in less urbanised areas, significantly boosted acceptance infrastructure with the Point-of-sale (PoS) terminals increased 24.7% to 1.1 crore, and the UPI QR codes surged 91.5% to 65.8 crore.
In the Financial Year, RBI authorised 26 online Payment Aggregators, 6 cross-border PAs, 11 non-bank prepaid payment instrument (PPI) issuers, 1 Trade Receivables Discounting System (TReDS) entity, and 1 white-label ATM operator.
Card-based transactions also saw a modest uptick, rising to 63.9 crore from 58.5 crore a year earlier. The increase was primarily driven by a 34% jump in credit card usage. However, debit card transactions declined for the second consecutive year, falling to 16.1 crore from 22.9 crore in FY24.
Looking ahead, the RBI has outlined plans to enhance the digital payment landscape by focusing on Artificial Intelligence (AI) governance, Rolling out e-Kuber 3.0, its next-generation core banking system, Developing cloud infrastructure to boost operational efficiency and cyber resilience.
The central bank reiterated its commitment to deepening financial inclusion and innovation in India’s rapidly evolving digital economy.