Blitz Bureau
As of early June 2025, daily transactions through the Unified Payments Interface (UPI) have overtaken Visa’s global daily average. Industry experts predict that by FY2029, UPI will process 439 billion transactions annually, over three times its FY24 volume. This shift signifies a major turning point in global finance, where a home-grown system from an emerging economy leads in digital payments volume.
UPI, the flagship digital payment platform developed by NPCI, has been consistently processing over 650 million transactions daily — exceeding Visa’s daily average of 640 million. With this, India’s indigenous real-time payment system has become the most widely used digital payment platform in the world by volume.
Support for UPI has also come from the International Monetary Fund (IMF) which in its latest report titled “The Value of Interoperability” says that interoperability has long been a goal for payment systems, which are often siloed and operate in parallel. In addition to increasing efficiency and boosting digital payment adoption, data from IMF shows that an interoperable ecosystem stimulates commerce, reduces transaction costs, and expands access to credit.
The study highlights data from India’s UPI which enables seamless transactions between users of different payment providers, unlike closed-loop systems.
Unsurprisingly, interoperability plays a key role in driving digital payment adoption. Enabling different payment apps to work seamlessly with one another expands the reach of digital payments by giving users the freedom to choose their preferred app. The IMF encourages other countries seeking to reduce reliance on cash transactions to prioritise interoperable payment systems.
“Regions where interoperability increased by more indeed saw a significant increase in adoption of digital payments, both in absolute terms and relative to cash,” the study concludes.
But the benefits don’t stop there. Allowing users to access payment methods through multiple apps lowers barriers to entry and paves the way for more innovative offerings in the payments ecosystem. Interoperability also incentivises existing providers to enhance the quality of their services as a means of retaining users.
Contrast with traditional fintechs
Interoperability has long been a challenge for payment systems in many countries, including the US, because different rails operate on separate systems. If a US company wants to send a real-time payment, the sending institution might be set up for FedNow, while the receiving one might default to ACH.
The IMF study compared UPI transactions with data covering all transactions from an unnamed major fintech firm. This provider processed payments over a closed network, where both parties had to use the same wallet app. Researchers then analsed users’ app choices after their first experience with digital payments.
The report noted: “After sampling both, users increasingly chose the interoperable UPI system over the closed-loop alternative. Crucially, transactions that would not be possible without interoperability — those where the sender and recipient use different apps — were a substantial part of this growth.”
What is UPI?
• Launched in 2016 by the National Payments Corporation of India (NPCI).
• Enables instant bank-to-bank transfers via mobile platforms.
• Supported by multiple apps (PhonePe, Google Pay, Paytm, etc.).
• No cost to users; built on IMPS architecture with 24×7 availability.
UPI versus Visa
• UPI’s current daily volume (June 2025): 648 million (surpassing Visa’s FY24 average of 640 million).
• UPI’s May 2025 daily average: Around 602 million.
• Visa’s FY24 annual volume: 233.8 billion transactions (~640 million/day).
• UPI’s FY29 projected annual volume: 439 billion transactions.
• UPI’s share in India’s digital retail payments (FY29 forecast): Over 90%.
Driving Factors Behind UPI’s Surge
• Real-time, zero-cost payment model attracting both consumers and merchants.
• Wider rural adoption facilitated by increasing smartphone and internet penetration.
• Merchant integration at small and large scales.
• Innovations such as UPI-based credit and offline payments.
• Global expansion through cross-border corridor tie-ups.