VOIWORLD/BUSINESS DESK
India is now leading the world in fast digital retail payments, says a new report by the International Monetary Fund (IMF). This is mainly because of the Unified Payments Interface (UPI), which helps users make over 18 billion transactions every month — more than any other country. It has even surpassed UPI to overtake Visa to become world’s top real-time payments system
Here is the take of Abhay Johorey, MD, Protiviti Member Firm for India
What Makes UPI Special?
UPI works on an open system. That means people using different banks or payment apps can easily send and receive money. This is better than closed systems where both sender and receiver need to use the same app or bank. Because of UPI’s open design:
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Users have more choices.
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Apps compete to offer better services.
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It’s easier to innovate and improve features.
Key Benefits
The IMF report explains that UPI gives:
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Direct benefits: better apps, fewer failures, and extra features like QR code scanning and sound alerts.
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Indirect benefits: competition among apps pushes them to improve service.
In 2023–24, many users switched from their bank apps to fintech apps with better features and lower failure rates. Even new apps gained users because UPI allows everyone to compete fairly.
Why Did This Happen in India?
India’s digital payment growth was supported by:
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Aadhaar (digital ID system)
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Jan Dhan Yojana (bank accounts for everyone)
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Low mobile data costs
These changes made it easier for millions of people to access digital payments.
A Word of Caution
Although UPI is a big success, the IMF warns that most of the transactions now happen through just two apps — Google Pay and PhonePe. This could reduce competition and limit user choice in the future. The IMF suggests that India must keep watching the market to ensure fairness and openness.
