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Happy Monday! UPI's ease of use is driving a shift to cashless payments, leaving debit cards behind. This and more in today’s ETtech Morning Dispatch. Also in the letter: ■ Rare Rabbit’s Rs 500-cr funding round ■ TCS employees upskill ■ Wipro Consumer VC’s next investment UPI steals debit card’s thunder in e-payments The ease of digital transactions is driving a shift away from debit card usage as customers and merchants increasingly prefer Unified Payments Interface (UPI) for day-to-day payments.

What’s the matter: Deployment of new point-of-sale (PoS) terminals grew 14% year-on-year in FY24, the slowest pace since demonetisation, data from the Reserve Bank of India (RBI) showed. The only exception was 2021-22, when Covid-19 hurt offline commerce in a major way. Why’s it important? Industry insiders told us that while new PoS terminals are still being deployed, it’s mostly in organised and large format retail, which offer all payment forms.



However, grocery shops, smaller stores and eateries are tilting towards QR code-based UPI transactions. According to RBI data, 346 million such QR codes were in use in March this year, compared with 172 million in the same month in 2022. Zoom in: The convenience of a smartphone scan over card usage has made UPI an attractive alternative.

But the mandate from the government for a zero merchant discount rate (MDR) — the fee charged for processing a transaction — is also encouraging merchants to switch to UPI payments.

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