Modi Celebrates UPI's Success: How UPI Moved From Rollout Phase To Everyday Payment Default

During the address by Prime Minister Narendra Modi in Oman on Thursday, December 18, on the journey of innovations by India, the Unified Payments Interface (UPI) was highlighted during the discussion on the progress made by technology in the country. Almost a decade since the launch, the role played by UPI has gone beyond the mere payment option. For a large section of users, it is now the default way to move money.

From Policy Vision to Payment Infrastructure

UPI was launched in 2016 by the National Payments Corporation of India (NPCI) to make payments through a digital medium simpler for people. The concept behind making UPI involved making an instant fund transfer from one bank to another without requiring account numbers or an IFSC code, instead, with only a virtual payment address.

In the early years, adoption was limited. Payments were still dominated by cash and cards. Awareness about UPI was still low. As time passed, ease of use, low transaction charges, and banking interoperability helped UPI to gain momentum. A system which was mainly a result of a policy intervention, has become a major payment enabler.

How UPI Reached the Mass Market

The adoption of the UPI increased rapidly once its relevance in smaller and recurring transactions became highlighted. The use of QR codes made it absolutely necessary for smaller merchants to have access to digital payments without necessarily investing in the more costly technology used in card swipe payments. This process of QR codes was faster compared to using cash or card swiping.

The years of the pandemic also acted as a major catalyst. With the requirement for contactless payments, the use of the UPI system went into overdrive.

According to NPCI, as of late 2025 (November/December), India's UPI transactions are booming, with monthly volumes crossing 19-20 billion transactions and values over Rs 24-27 lakh crore (Rs 24-27 trillion), with Q3 2025 seeing over 59 billion transactions and a ~33.5 per cent year-on-year growth, solidifying its dominance for daily retail (P2M) and social (P2P) payments, with projections for continued strong growth into early 2026.

In November 2025, UPI recorded 32 per cent y-o-y growth in transaction volumes, crossing 19 billion transactions with average daily transactions of 682 million and daily value of Rs 87,721 crore, even as it logged 25 per cent annual volume growth to 20.70 billion transactions and 16 per cent value growth to Rs 27.28 lakh crore last month, while transactions surged 35 per cent year-on-year to 106.36 billion in the first half of 2025.

UPI and the Changing Money Habits

UPI reshaped everyday money behaviour in subtle but lasting ways. Small-value payments moved online at scale, something earlier systems struggled to support efficiently. Peer-to-peer transactions became routine for rent and shared expenditures. For many users, UPI was their first experience with formal digital finance.

The platform steadily expanded its use cases. Features like AutoPay for automated payments, UPI 123PAY, UPI Lite, and integration of RuPay credit cards with UPI are some of the examples that increased accessibility without making it complicated for users.

Global Scale Backed by Policy Push

The scale of UPI has made a global impact. Recently, in a report titled Growing Retail Digital Payments, the International Monetary Fund has identified UPI as the world's largest retail real-time payment system by volume. Subsequently, the report Prime Time for Real-Time 2024 issued by ACI Worldwide revealed that the volume of real-time payment transactions via UPI constitutes about 49 per cent of total global real-time payment transactions.

The difference brings out a stark contrast. According to data from the ACI Worldwide report and the IMF report, India handled 129.3 billion real-time transactions, which was significantly higher compared to 37.4 billion from Brazil, 20.4 billion from Thailand, and 17.2 billion from China. South Korea handled 9.1 billion.

This scale has been supported by targeted policy interventions. Incentives for low-value BHIM UPI transactions and Payments Infrastructure Development Funds (PDIF) have promoted digital payment services in smaller centres. As of October 31, 2025, 5.45 crore digital touch points have been set up in tier 3 to tier 6 centres under PIDF. By FY 2024-25, about 56.86 crore QR codes were deployed across nearly 6.5 crore merchants.

The government, along with RBI and NPCI, have also facilitated the integration of UPI and RuPay in public services, transportation systems, as well as e-commerce platforms.