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NPCI, the National Payments Corporation of India, has been a driving force in advancing digital payments in the country. NPCI manages various payment systems, including IMPS, UPI, BHIM, NACH, RuPay, AePs, FASTag, and BBPS. Despite its frequent media coverage for the volume and value of transactions processed, its financial performance has not been thoroughly examined until now.
According to its annual financial statement for FY22, NPCI’s operating revenue grew by 45.3% to Rs 1,629.5 crore from Rs 1,121.6 crore in FY21. Payment services made up 96.1% of NPCI’s operating revenue, surging 46.3% to Rs 1,566.64 crore in FY22. While certification income grew by 9.7% to Rs 10.39 crore, network income dipped 42.4% to Rs 17.54 crore.
NPCI’s profit in FY22 increased by 84.4% to Rs 773.4 crore from Rs 419.5 crore in FY21. Its ROCE and EBITDA margin remained positive at 25.86% and 63.43%, respectively. NPCI’s shareholders include public sector banks, private banks, and other financial services players.
Despite NPCI’s success, concerns about its role as a partner overseeing major innovations in the sector have been raised. It is crucial to ensure that NPCI’s ecosystem and influence do not stifle potential innovators or innovations elsewhere.
The financial sector has a wide range of charges, from the low-cost delivery of UPI to the usurious charges for forex transactions. NPCI’s disruptive influence on the easy profits and growth enjoyed by VISA and Mastercard in credit cards should not lead to NPCI becoming the very entities it disrupted with the UPI stack.
