The year 2021 saw India’s real-time transactions moving up to a staggering 48.6 billion, almost threefold that of the closest challenger China with 18 billion transactions, and close to seven times greater than the combined real-time payments volume (7.5 billion) of the world’s leading economies: U.S., Canada, U.K., France and Germany, as per an ACI Worldwide Report released this morning with The Hindu.
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The widespread adoption of real-time payments resulted in an estimated cost savings of $12.6 billion for Indian businesses and consumers in 2021, which helped to unlock $16.4 billion of economic output which represents 0.56% of the country’s GDP, according to the study published by ACI Worldwide, a provider of real-time payment software in partnership with GlobalData, a data and analytics firm and the Centre for Economics and Business Research (Cebr).
The growing acceptance of UPI-based mobile payment apps and QR code payments among merchants, combined with the increased use of digital payments during the COVID-19 pandemic, helped real-time payments secure 31.3% of total payments transaction volume in the country in 2021, found the study.
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With consumers increasingly shifting from cash to mobile-based real-time payments, skipping payment cards, the real-time payments’ share of the total payments volume would rise to over 70% in 2026 – with net savings for businesses and consumers forecast to rise to $92.4 billion in 2026, helping generate an additional $45.9 billion of economic output, equivalent to 1.12% of the country’s forecasted GDP, it added.
Ankur Saxena, Head of South Asia, ACI Worldwide said, “India is the poster child for real-time payments and a shining example of how a coordinated, collective, nationwide effort can unlock huge economic and social potential.’‘
“India’s craving for cash may be plummeting, but there is still a great deal to do. It is time to accelerate our efforts and expand this impact beyond the top tier metropolitan areas and replicate our success for the benefit of the entire country,’‘ he further said.
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Globally, real-time payment transactions crossed 118.3 billion in 2021, a YoY growth of 64.5%, set to rise to 427.7 billion in 2026.
Thailand, Brazil and South Korea stood behind India and China with real-time transactions volumes of 9.7 billion, 8.7 billion and 7.4 billion, respectively.
The report tracked real-time payments volumes across 53 countries and it covered all G20 nations excluding Russia. Interestingly, over half (52.71%)of consumers worldwide now own and use a mobile wallet, the research found.
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Real-time payments improve liquidity, productivity
The study noted that real-time payments improved liquidity in the financial system and therefore functioned as a catalyst for economic growth.
“By allowing for the transfer of money between parties within seconds rather than days, real-time payments improve overall market efficiencies in the economy,” commented Owen Good, Head of Advisory, Centre for Economic and Business Research.
Globally, real-time transactions offered an aggregated net savings of $46,6 billion for consumers and businesses in 30 countries in 2021 and savings are likely to go up to $184 billion by 2026.
The study also found that 53 countries would have required to deploy 4.9 billion people to manually execute these many transactions with an equivalent level of output and by 2026 the job requirement may go up to10.3 billion, as per the study.