SBI, other banks report fewer tech glitches in UPI transactions

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Bank customers using UPI (Unified Payments Interface) transactions have continued to face technical glitches, but the National Payments Corporation of India (NPCI) data for March, 2021, shows that most banks have reported a significant decline in their failure rate.

State Bank of India (SBI), which had reported a massive technical decline rate of 8.96% in December 2020, has shown a steady improvement and reported a decline of 0.90% of its total UPI transactions in March 2021. The largest bank in the country reported 775.55 million transactions in March, making it highest among remitter banks. Among beneficiary banks, SBI stood at the second place with 413.33 million transactions.

In January and February, SBI reported a technical decline of 1.44% and 1.2% respectively.

In March, Union Bank of India reported a technical decline of 2.12%. In January, it had clocked a massive technical decline of their UPI transactions at 12.89%. In February, it reported 4.2% decline.

The two banks that reported high level of technical decline in March are Indian Bank (6.39%) and Andhra Bank, at 5.12%. Even these banks have shown a steady improvement on their month-on-month performance. In February, Andhra bank’s technical decline rate stood at 15% while Indian Bank recorded a technical decline rate of 10.28%.

As of March, the best among Indian banks in terms of technical decline are Paytm Payments Bank (0.05% decline rate), HDFC Bank (0.13%), Yes Bank (0.30%), Canara Bank (0.34%), Bank of Baroda (0.34%), Axis Bank (0.60%), SBI (0.90%), ICICI Bank (1.01%) and Airtel Payments Bank (1.30%).

Some banks have reported higher level of technical decline in March, worse than their previous month performance. For instance, Bandhan Bank and Karur Vysya Bank posted 3.67% and 3.34% respectively, in March, higher than the decline reported in February.

According to NPCI, technical decline is due to reasons such as unavailability of systems and network issues on bank or the NPCI side.

Technical upgrade

Bankers said the continuous upgradation of the fast-growing digital payment systems and increased investment in the technical support and the IT backbone have helped banks improve their success rate.

The banks have also improved substantially on the other metric of Debit Reversal Success Rate. It indicates the percentage of total cases where a customer account may be debited and the bank is unable to confirm instantly about the status of reversal of such a debit. When reversal/credit is not processed instantly, it is processed manually by the bank as per the Reserve Bank of India (RBI) guidelines.

According to NPCI data, total UPI transactions in March have jumped to 2.73 billion, both person-to-person and person-to-merchant transactions put together, accounting for Rs 5,04,886 crore.

PhonePe and Google Pay have continued to dominate India’s UPI market as they collectively hold about 79% of the total UPI transactional volumes in March. Walmart-owned PhonePe has led the pack in terms of the number of UPI transactions, accounting for 43.9% of the total UPI transactions volume, with 1,199.51 million transactions accounting for Rs 2,31,412 crore. Google Pay reported a 35% market share in March, with 957.01 million transactions worth Rs 2,01,185 crore). Paytm Payments Bank remained at the third spot with 401.16 million transactions accounting for Rs 43,221 crore.