UPI transactions are evolving per month and are seeing an exponential growth where current volumes outpaces the previous month’s, Nitin Chugh, DMD and head of digital banking and transformation of SBI, said on Thursday.Â
“UPI is evolving by the month, the volumes can’t keep pace with the previous month’s. SBI does 19.5 crore UPI transactions per day,” he said during a panel discussion on ‘Rewriting Banks: Emergence of the Digital Beast’ at the BT Banking & Economy Summit. In January, UPI transactions grew 1.6 per cent in volume to 16.99 billion, up from 16.73 billion in December 2024, said data from the National Payments Corporation of India.
In the past six months, he added, the same users are using UPI a lot more creating additional categories for the banks. “UPI has certainly expanded the pie. The whole new category of being able to lend on the basis of transactions and the flows that has emerged. Because the transaction velocity is so high, it is leading to the creation of a lot more algorithms that will help us to make sense of the data a lot better,” Chugh said.Â
Co-panelist Hemant Jhajhria, partner, head of consulting at KPMG India, said that from a technology perspective, the UPI success has to be replicated in more areas. He also stressed on the significance of more investment in technology in the banking sector.Â
Responding to a question on the markets not seeing the opportunity of cross-selling for every Indian bank, Chugh said that the digital businesses are inherent for private and public sector banks. “Digital for us is not something sitting outside. The SBI’s YONO, for example, is not sitting outside the bank. It is our new way of doing business. So when you’re modernizing and digitizing, it is going to take a few years. The market capitalisation of SBI has progressively grown up. But we haven’t seen a scenario where there has been a correction because YONO was over-valued. This is because it is inherent to the bank,” he said.
The panelists also discussed the impact of the fast-evolving digital technologies on the banking landscape such as AI becoming mainstream, Microsoft’s new quantum chip, shortening technological cycles, shifting consumer behavior and a reducing attention span. “AI is going to help us in a big way with hyper-personalization in the banking sector… If you don’t evolve, it will be difficult to compete in this segment,” said Vishnu R Dusad, Managing Director & co-founder, Nucleus Software, who was also on the panel.
On the menace of cybersecurity, Jhajhria said it is a cat and mouse game. “The more banks invest in cyber security, the better chances of keeping ahead in the game,” he said.
Â