Festive spending drives record UPI transactions in October

Festive spending drove a pickup in digital payments in October, with transactions on the Unified Payments Interface (UPI) rising to a record 25.47 billion, up 23% year-on-year, according to data released by the National Payments Corporation of India (NPCI).

UPI processed transactions worth Rs 31.53 lakh crore during the month, a 16% rise from a year earlier and the highest on record, signalling that the platform continues to expand even as consumers navigate higher prices of electronics and other festive purchases this year.

In October, consumers ramped up festive shopping, dining, and other discretionary spending, alongside using UPI for everyday transactions. Beyond Navratri and Durga Puja, major e-commerce festive sales also began in October, boosting payment volumes and transaction sizes.


The average daily UPI transaction count rose to 822 million in October from 802 million in September, indicating a pickup in payment activity beyond the impact of the additional day in the month. Transactions peaked at 873 million on October 9, the weekend before Navratri began, and remained elevated through October 19, a day ahead of Dussehra, before moderating, per NPCI data.

The average daily transaction value also increased to a record Rs 1.01 lakh crore from Rs 97,913 crore in the previous month. The record volumes come as the government has deferred the proposed MDR (merchant discount rate) on UPI transactions until after Diwali, keeping the festive-season payments ecosystem free of additional charges for now.

“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,” said Reeju Datta, cofounder of payments firm Cashfree.

The October figures mark a recovery in monthly transaction volumes after UPI recorded 24.07 billion transactions in September, down from 24.51 billion in August. Transaction value had also slipped to Rs 29.37 lakh crore in September from Rs 29.82 lakh crore in August.

The September slowdown had come ahead of the peak festive shopping period, when consumers typically increase spending on electronics, apparel, food, and other categories. However, prices of smartphones, laptops, and other electronics have risen 30-40% in recent months, triggered in part by a surge in memory chip prices, dampening overall demand.

ET reported on October 19 that Amazon’s Great Indian Festival and Flipkart’s Big Billion Days shopping events were running 10-12% below the year-ago period due to sluggish demand for premium electronics, including smartphones, home appliances, and laptops.

Going ahead, fintechs expect UPI transaction volumes to remain elevated in November, with Dhanteras and Diwali falling in the month, potentially driving another surge in festive spending. “Occasions such as Dhanteras are also likely to drive higher-value transactions, particularly in gold and other traditional festive purchases,” said Akshay Mehrotra, MD and Group CEO of digital lender Fibe.