New Delhi, Aug. 26: What began as a relatively modest digital payment initiative in India has evolved into one of the world’s most prominent real-time payment systems, transforming everyday transactions and placing India’s digital financial infrastructure on the global stage.
When Prime Minister Narendra Modi launched the BHIM UPI (Bharat Interface for Money–Unified Payments Interface) app during the inauguration of the DigiDhan Mela on December 31, 2016, he had urged citizens to make digital payments a habit as part of India’s transition towards a less-cash economy.
Nearly a decade later, UPI has grown into a central component of India’s digital payments ecosystem, with its scale extending far beyond the expectations associated with its early days.
On Tuesday, Modi recalled UPI’s transformative journey and highlighted the scale it has achieved over the past decade. He described the platform’s growth as a matter of pride for Indians and invited citizens to share their experiences of using UPI and how it has changed their daily lives.
The growth is reflected in the numbers. During its first month of operations in August 2016, UPI recorded around 90,000 transactions. By the financial year 2025-26, it accounted for about 84 per cent of India’s digital payment transactions.
The number of banks connected to the platform has also expanded dramatically. From 44 banks in FY 2016-17, the number of banks live on UPI reached 703 in FY 2025-26, covering public and private sector banks as well as small finance and cooperative banks.
Developed by the National Payments Corporation of India (NPCI), UPI enables users to make real-time payments directly through participating applications and bank accounts. Platforms including BHIM, PhonePe, Google Pay and Paytm have helped bring UPI into everyday use across different sections of society.
From large businesses and organised retailers to street vendors, students, farmers and small shopkeepers, digital payments have become increasingly accessible through QR codes and mobile devices.
The scale of UPI’s expansion is particularly striking when compared with its early years. In its first year, the platform processed fewer than two crore transactions. By 2026, the number had increased to more than 24,000 crore transactions, with the transaction value approaching Rs 314 lakh crore.
The Prime Minister has repeatedly pointed to this growth as an indication of India’s emergence as a major force in digital payments. UPI is now estimated to account for nearly half of global real-time payment transactions.
International recognition has further strengthened its position. In a June 2025 report titled “Growing Retail Digital Payments: The Value of Interoperability”, the International Monetary Fund highlighted UPI as the world’s largest retail fast-payment system by transaction volume.
The IMF also pointed to UPI’s interoperability as one of the important factors behind its rapid adoption. Users can choose between multiple banks and payment applications while continuing to transact through a common interoperable system.
This interoperability has been central to UPI’s success. Instead of tying consumers to a single payment application or financial institution, the system allows different banks and apps to operate within a common infrastructure.
The impact has extended beyond convenience. UPI has contributed to the wider democratisation of digital financial services by allowing individuals with smartphones and bank accounts to participate in an increasingly digital economy.
Its expansion has also moved beyond India’s borders. UPI-based payment mechanisms have been introduced or accepted in several countries, including Bhutan, Nepal, France, the UAE, Singapore, Cyprus and Qatar. Further expansion is taking place across parts of Europe, Southeast Asia and the Middle East.
For Indian tourists and expatriates, international UPI acceptance can make payments easier by allowing them to use familiar digital payment mechanisms while travelling abroad. Businesses can also benefit from easier cross-border payment arrangements where such integrations are available.
The international expansion has given UPI significance beyond its role as a domestic payment platform. It has increasingly become part of India’s broader digital diplomacy and economic outreach, demonstrating how technology developed for India’s domestic needs can acquire international relevance.
Several countries and institutions are also exploring digital payment systems inspired by similar principles of interoperability and real-time transactions.
UPI’s journey therefore represents more than a story of rapidly increasing transaction volumes. It is also a story of how digital infrastructure can reach large sections of a population and become embedded in everyday economic activity.
Its growth from around 90,000 transactions in its first month to thousands of crores of transactions annually illustrates the scale at which India has adopted digital payments.
As UPI enters its second decade, its significance lies not only in the volume of money transferred through the platform but also in the infrastructure and confidence it has helped build around digital transactions.
From a payment system designed to make digital transactions easier within India, UPI has evolved into a globally recognised example of interoperable financial infrastructure.
Its decade-long journey reflects India’s effort to combine technological innovation with mass adoption — turning a digital payment platform into an important part of the country’s economic transformation and an increasingly visible element of its global digital identity.
