Context
Recently, the Unified Payments Interface (UPI) completed ten years, emerging as the world’s largest real-time payment system by transaction volume. In FY 2025–26, UPI processed over 24,162 crore transactions worth about ₹314 lakh crore and accounted for 84% of India’s digital payments.
Explanation
- UPI, launched in 2016, is an instant, interoperable payment system developed by the National Payments Corporation of India (NPCI) under Reserve Bank of India (RBI) oversight.
- It enables 24×7 real-time bank-to-bank transfers using identifiers such as a UPI ID, without requiring users to repeatedly enter bank-account details.
- UPI supports Person-to-Person (P2P) and Person-to-Merchant (P2M) payments through multiple participating apps.
- Its interoperability allows customers of different banks and payment apps to transact on a common network.
- UPI forms a key pillar of India’s Digital Public Infrastructure (DPI) and promotes financial inclusion and low-value digital payments.
- In FY 2025–26, P2M transactions formed 63% of volume, while P2P transactions contributed 71% of value.
- UPI accounted for nearly 49% of global real-time payment transaction volume in 2025.
- It is currently operational in 11 countries, supporting the internationalisation of India’s digital-payment infrastructure.
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