Wary of international gamers’ duopoly in UPI market, MPs plan to boost concern in Parliament
With the funds by varied UPI apps quick turning into the norm of the day, regulators and even lawmakers have gotten cautious of a robust duopoly available in the market and that too of foreign-owned entities.
As per the newest knowledge from the National Payments Corporation of India (NPCI), which is pushing for capping the market share of every participant at 30 per cent, there have been greater than 5 dozen UPI (Unified Payments Interface) apps registered within the nation on the finish of June 2022 and collectively they accounted for five.8 billion transactions with a complete worth of over Rs 10 lakh crore throughout the month.
However, the top-two gamers — Walmart-owned PhonePe and Google’s G-Pay — accounted for greater than 81 per cent of the entire quantity and almost 84 per cent of the worth.
Adding PayTM, the share of the top-three gamers rose even additional to 96 per cent.
Amazon Pay, one other international participant, which usually figures within the high 5, has additionally been in search of to develop its market aggressively nevertheless it instructions nearly 1 per cent for now.
WhatsApp has additionally been attempting to make inroads on this area however has bought restricted share to date.
Multiple MPs, together with some from the ruling celebration BJP, stated they plan to boost the difficulty in Parliament throughout the upcoming monsoon session and likewise in conferences of related Parliamentary panels.
None of them agreed to be recognized, saying a proper place is but to be taken on the matter by their respective events.
While the market gamers are required to scale back their market share to inside a regulatory cap of 30 per cent by January 2023, some are already lobbying arduous to get the deadline prolonged.
The MPs stated that it isn’t good for a couple of gamers to dominate this essential market and extra so not when the dominance is of international entities and there might be systemic dangers.
As per the NPCI knowledge, the scenario was not like this at first.
In the primary quarter of fiscal yr 2016-17, since when the information is offered, all high 5 gamers had 9-10 per cent market share, nevertheless it began altering from the next quarter itself with two of them getting over 15 per cent every. By the fourth quarter of that yr, the highest participant had over 45 per cent and the second 35 per cent.
In the third quarter of the next yr, the highest participant had bought greater than 61 per cent, although it fell quickly and remained within the vary of 33-36 per cent until the second quarter of 2019-20, earlier than rising once more to greater than 40 per cent for a number of quarters now.
The high two gamers have been commanding greater than 80 per cent market share collectively for a very long time now, an MP identified citing the NPCI knowledge.
In the UPI ecosystem, rules are nonetheless evolving they usually principally experience on compliances of sponsor banks.
NPCI got here out with customary working procedures for UPI apps in March 2021, during which it known as for a 30 per cent quantity market share cap for them in order to even out the distribution of market share alongside all members.
