wordpress blog stats
Connect with us

Hi, what are you looking for?

NPCI Upgrading Major Payments Platforms In Anticipation Of Higher Volumes: Report

https://www.flickr.com/photos/110751683@N02/13334080323/in/photolist-mjhDwB-dV9B2q-64qJMN-jgx2o-8pMJsz-xfViBg-dRuMzt-5MRyHK-8iDtbN-rLBXnZ-dSdtGx-s45gBT-5fYuNc-3T59Nf-tUrUhd-tWUNt8-tWqSGq-tEbCUL-sZLbNj-wihfSf-tqw8f-wiheTb-sXzBX-wXQ2QB-wikacS-xfV8j2-pmsAN4-fBvhjC-xd1oxb-wXGj7j-wiiT5U-io1t3T-pVRDno-MSB83-7mQgg4-9hkLqH-xfmNPz-6PC5H1-64sAr9-oJVhV1-JCdCN-8pMHUT-8pMJiv-gngGKL-gzgB-5ydiLT-5nEvBb-64okSt-yRKL3-9ERwMN

The National Payments Corporation of India (NPCI) is in the process of upgrading its IT system and several of its payments platforms by the end of March this year, in anticipation of a surge in transaction volumes going forward, the Economic Times reported. In the last few months, leading banks like HDFC Bank and State Bank of India faced system outages towards the end of last year, payments companies sitting on top of NPCI’s infrastructure also faced outages due to the high volume of digital payment transactions.

In the wake of the COVID-19 pandemic, digital payments adoption has increased significantly with several of NPCI’s platforms clocking historical highs every month. But this growth has been unsustainable as the underlying banking infrastructure has been overwhelmed by the surge in transaction volumes in the last few months. According to MediaNama’s calculations, based on NPCI data, the transaction failure rate on the Unified Payments Interface (UPI) stood at 3.4% as of December 2020 compared to 0.99% in January 2020.

The report, citing unnamed sources, said that so far the NPCI has upgraded its IT systems for the UPI and the National Automated Clearing House (NACH), and will complete the upgrades for the Immediate Payment Service (IMPS) and the Aadhar Enabled Payment System (AEPS) by the end of FY21. The NPCI’s IT upgrade encompasses three aspects: ensuring the system can handle increased volumes, greater resilience against bank system outages and improved IT architecture at the NPCI so that credit pile-ups are processed quicker, it added.

With the adoption of UPI growing among consumers, IMPS volumes growing for large ticket payments, AEPS volumes growing as the government uses the payments platform to deliver welfare benefits and NACH being adopted by investment companies, lenders and insurers, the NPCI’s overall payments system has a lot of weight to carry going forward. Therefore, it is not surprising that it is undertaking a large system upgrade across platforms.

According to data from the Reserve Bank of India, UPI has clocked over 1.4 billion transactions worth Rs 2.65 lakh crore between February 1 and 17 this year. Similarly during the same period, IMPS has clocked Rs 1.73 lakh crore transactions, while NACH (Debit and Credit) transactions so far this month stand at Rs 1.13 lakh crore and AEPS recorded Rs 162 crore worth 0f transactions. The four platforms combined processed an average of 106 million transactions on a daily basis so far in February 2021, compared to 104 million during the same period in January 2021.

Advertisement. Scroll to continue reading.

In 2020, there were over Rs 33.8 lakh crore UPI transactions, over Rs 26 lakh crore IMPS transactions, over Rs 16.9 lakh crore NACH transactions and Rs 1.98 lakh crore AEPS transactions, according to NPCI data.

The NPCI’s upgrade have not been smooth. Last month, it was upgrading the NACH system which coincided a new rule on mutual fund investments. As a result, thousands of investors found that their payments to mutual funds were stuck and therefore, they were not allotted units in the respective mutual funds. In response to the incident, the NPCI said that the incident was unfortunate and that it regrets the inconvenience caused. ““We have recently migrated our systems with an objective to scale the NACH infrastructure to meet the increasing volume requirements and industry demands. This was a planned migration activity and during which we faced some initial teething issues such as delay in settlement,” it said in a statement.

Also Read

You May Also Like

News

Flipkart, Mastercard and PayU will join the Tata Group-led consortium to create a digital payments New Umbrella Entity (NUE), the Economic Times reported. The...

MediaNama is the premier source of information and analysis on Technology Policy in India. More about MediaNama, and contact information, here.

© 2008-2021 Mixed Bag Media Pvt. Ltd. Developed By PixelVJ

Subscribe to our daily newsletter
Name:*
Your email address:*
Please enter all required fields Click to hide
Correct invalid entries Click to hide

© 2008-2021 Mixed Bag Media Pvt. Ltd. Developed By PixelVJ