Diwali, the Festival of Lights, causes the biggest shopping and spending rush of the year in India. This cultural event is also a massive, live test for India’s digital money system. For the companies that run payment gateways and process transactions, Diwali is about showing that their systems can handle a huge spike in demand quickly and reliably.
The main player here is the UPI (Unified Payments Interface). It has grown incredibly fast from 92 crore transactions in 2017-18 to over 13,116 crores in 2023-24. But the number of payments jumps dramatically during the Diwali week, often hitting hundreds of millions of transactions in a single day. Payment companies must make sure their systems can adapt to handle this volume. If payments fail or slow down during this time, customers will lose trust in the digital system.
The holiday buying of expensive items like electronics and gold means more people use high-value payment methods. Credit and Debit cards are used heavily, especially online. This is often accentuated by e-commerce companies offering big discounts and easy instalment (EMI) plans. Indeed, reports show a sharp increase in card payments online during Diwali. Fintech companies also strongly promote easy loan products like Buy Now, Pay Later (BNPL), which are conveniently built right into the checkout page.
Diwali also shows how far digital payments have reached across the country. The fastest growth is now coming from smaller towns (Tier-2 and Tier-3). This means payment tools need to be accessible everywhere, and be inexpensive to use. To this end, Fintech companies have now installed QR codes and soundbox devices, making it simple for even the smallest vendor to accept instant UPI payments. The growth of QR code payments, increasing by over 30% in transaction volume in some periods, proves how successful local digitisation push has been.
Finally, the spike in digital investing, especially for gold on Dhanteras, shows a parallel growth in capital flows. These days, people use apps to buy digital gold and other assets. This forces payment systems to not only handle the payment quickly, but also to securely connect with banks and regulators to settle the investments in real time.
The ability of payment gateways to scale flawlessly under this intense pressure validates the Indian fintech ecosystem. The resilience of the network will unlock new opportunities in cross-border UPI transactions and the financial inclusion of India’s rural economy in the long term. The current proven technology is the foundational layer that will ensure the sector will not only meet its expected growth of more than 16% each year through 2032, but will also establish India as the global benchmark for digital payment architecture.
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