Banks have achieved more than 4,500 crore digital transactions for the year 2019-20, exceeding its target of 4,019 crore by 12 percent, said the government in a letter addressed to top executives of 56 public and private sector lenders. Moneycontrol has seen a copy of the letter which was written on July 3, 2020.
Since financial year 2018, the Ministry of Electronics and Information Technology (Meity) has been setting targets for banks in terms of digital payments, with every individual bank being given their own targets with respect to their size and potential. Last year, banks had cumulatively achieved more than 3,100 crore digital transactions against a set target of 3,013 crore.
In terms of the standing of the banks, private sector behemoth ICICI Bank has been given the top position with a score of 83, having achieved 100 percent of point-of-sales deployment at merchant outlets and 111.5 percent or 310 crore in terms of total digital transactions target. The bank has reported more than 80 percent of merchants as active in urban areas and has recorded a very low number of transaction declines on UPI and AePS. In absolute terms, the bank had a target of 280 crore transactions.
UPI stands for Unified Payments Interface and AePS, the biometric payment mode, stands for Aadhaar Enabled Payments Service. All these are pre-COVID transaction numbers till March. Digital payment volumes had shown a sharp decline in April and May.
Mumbai-based Fino Payments Bank has managed to break into the top five rankings along with other commercial banks such as HDFC Bank, Yes Bank and IndusInd Bank. Fino has achieved a score of 77 as per Meity scorecard having achieved 100 percent in terms of its PoS deployment target and 103 percent in terms of digital payments target.
What needs to be understood here is that these rankings are based on percentage terms. Many of the smaller banks are usually allocated a smaller target. Hence in absolute terms, many of the lower-ranked banks might have recorded a higher number of transactions.
Public sector lender State Bank of India has achieved a rank of 10. SBI was given a target of 768 crore transactions the highest among all banks and it has achieved 105 percent of its transactions target, thereby reporting more than 800 crore transactions. However, the bank slipped in terms of PoS deployment target by achieving only 52 percent and active merchants in rural areas being only 63 percent.
Digital payments major Paytm Payments Bank has scored 65 in the scorecard with a ranking of 17 as per Meity report card. While the bank has achieved a 100 percent target in terms of PoS deployment, it has reported 79 percent of the merchants as active in the urban areas. In terms of digital payments, it has achieved around 82 percent of its set target, or around 410 crore transactions. In absolute numbers, the government had allocated the highest number of digital payments target to State Bank of India and Paytm Payments Bank.