India’s digital payments activity reached a new high in October as festive purchases and online shopping boosted consumer spending. According to data released by the National Payments Corporation of India (NPCI), Unified Payments Interface (UPI) transactions increased 23% year-on-year to a record 25.47 billion. The total transaction value also climbed 16% to ₹31.53 lakh crore, marking the highest monthly figure recorded so far.
Festive shopping drives payment activity
Consumers increased spending on shopping, dining and other purchases during October, alongside regular daily payments. Navratri, Durga Puja and major e-commerce festive sales contributed to the rise in transaction volumes and values.
The average daily UPI transaction count reached 822 million in October, compared with 802 million in September. Transactions peaked at 873 million on October 9, the weekend before Navratri, and remained high until October 19, a day before Dussehra, before declining.
The average daily transaction value also touched a record ₹1.01 lakh crore, up from ₹97,913 crore in September.
According to Reeju Datta, co-founder of payments firm Cashfree, “The festive season drove this rise. Navratri and the big online sales were in October, and people used UPI for bigger festive purchases, along with their everyday payments,”
The government has also postponed the proposed merchant discount rate (MDR) on UPI transactions until after Diwali, keeping additional charges out of the festive payments ecosystem for now.
UPI recovers after September slowdown
October’s performance marked a recovery from September, when UPI recorded 24.07 billion transactions, compared with 24.51 billion in August. Transaction value also declined to ₹29.37 lakh crore from ₹29.82 lakh crore during the same period.
The slowdown came ahead of the peak festive shopping season, when spending on electronics, apparel and food generally increases.
However, smartphone, laptop and other electronics prices have risen by 30-40% in recent months, partly due to higher memory chip prices. This has affected consumer demand.
Major online sales events, including Amazon’s Great Indian Festival and Flipkart’s Big Billion Days, recorded sales 10-12% below the previous year’s levels as demand for premium smartphones, home appliances and laptops remained weak.
November could bring another transaction surge
Fintech companies expect UPI activity to remain strong in November, with Dhanteras and Diwali likely to encourage further festive purchases.
Akshay Mehrotra, MD and Group CEO of digital lender Fibe, said, “Occasions such as Dhanteras are also likely to drive higher-value transactions, particularly in gold and other traditional festive purchases,”
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