India's UPI Overtakes Visa as World's Leading Real-Time Payment System
India's Unified Payments Interface (UPI) has achieved a significant milestone, surpassing global payment giant Visa to become the world's leading real-time payment system. This homegrown technology, launched less than a decade ago, now processes over 640 million transactions daily, demonstrating its remarkable growth and widespread adoption.
UPI's Ascendancy in Digital Payments
According to a recent report by the International Monetary Fund (IMF) titled "Growing Retail Digital Payments: The Value of Interoperability," UPI now accounts for an impressive 85 per cent of India's digital payments and nearly 60 per cent of global real-time digital transactions. In June 2025 alone, UPI recorded 18.39 billion transactions, processing a staggering ₹24 lakh crore. This represents a substantial 32 per cent year-on-year increase compared to June 2024.
- Key Takeaways:
- UPI handles over 640 million daily transactions, exceeding Visa's 639 million.
- It powers 85% of India's digital payments and nearly 60% of global real-time transactions.
- In June 2025, UPI processed 18.39 billion transactions worth ₹24 lakh crore.
- This growth represents a 32% year-on-year increase.
What is UPI and How Does It Work?
Unified Payments Interface (UPI) is a real-time payment system developed by the National Payments Corporation of India (NPCI) and launched in August 2016. Built on the Immediate Payment Service (IMPS) infrastructure, UPI allows users to link multiple bank accounts to a single mobile application. This enables instant fund transfers, peer-to-peer payments, merchant transactions, and recurring bill payments, all available 24/7, including holidays.
Its key innovation lies in its interoperability, allowing seamless money transfers across various platforms like Google Pay, PhonePe, Paytm, and BHIM, without friction.
Factors Driving UPI's Success
Several factors have contributed to UPI's rapid and widespread adoption:
- Interoperability and Open Access: The IMF report highlights that UPI's open architecture allows users to choose their preferred app, fostering competition and innovation among providers.
- Cost and Convenience: Since January 2020, the Indian government has enforced a zero Merchant Discount Rate (MDR) policy on UPI transactions, making it free for both consumers and merchants. This, combined with intuitive, multilingual user interfaces and low data usage, has made it highly accessible.
- Regulatory Backing and Inclusion: Government initiatives like the PM SVANidhi scheme, which incentivises street vendors to adopt digital payments, and the Reserve Bank of India's push for UPI integration into feature phones (UPI 123Pay), have significantly expanded its reach, particularly in underserved communities.
- Pandemic Catalyst: The COVID-19 pandemic accelerated the shift towards digital payments, with UPI experiencing exponential growth between 2020 and 2022.
UPI's Global Footprint
UPI's success is not limited to India. It has expanded its presence internationally and is currently live in seven countries:
- United Arab Emirates
- Singapore
- Bhutan
- Nepal
- Sri Lanka
- France
- Mauritius
Its entry into France marks a significant step into Europe, allowing Indian travellers and residents to make seamless payments without the complexities of foreign transactions. India is also advocating for UPI to become a standard within the BRICS group, aiming to improve remittances and boost financial inclusion globally.
The Future of UPI
Looking ahead, UPI is poised for further expansion and innovation. Efforts are underway to integrate UPI with bilateral payment systems in more countries, aiming to reduce fees and settlement times for cross-border remittances. The NPCI has also recently improved backend transaction response times, enhancing real-time reliability and paving the way for broader adoption. In just nine years, UPI has transformed from a domestic innovation into a global benchmark for real-time payments.
