UPI rules change from Feb 15 for faster resolution.

The National Payments Corporation of India (NPCI), which regulates UPI transactions in India, has announced changes aimed at improving the chargeback process. These changes, set to take effect from February 15, focus on automating the acceptance and rejection of chargebacks, reducing manual intervention, and ensuring smoother dispute resolution.

What’s Changing?

Currently, when a chargeback is raised, it requires manual verification and processing by banks, leading to delays, errors, and potential penalties. NPCI is now automating the process by introducing a system where chargebacks will be automatically accepted or rejected based on Transaction Credit Confirmation (TCC) and return data provided by the beneficiary bank.

Under this new system:

  • The beneficiary bank must raise a TCC or a return after the chargeback is initiated.
  • Based on this, the system will automatically determine whether the chargeback should be accepted or rejected.
  • This eliminates the need for banks to manually review every chargeback, making the process faster and more efficient.

This automation will be applied only to bulk chargeback processing and the Unified Dispute and Issue Resolution (UDIR) system. However, these changes will not be visible to customers through banking apps and will be handled internally by financial institutions.

What Are Chargebacks?

A chargeback occurs when a UPI transaction, initially deemed successful, is reversed by the issuing bank, acquiring bank, or NPCI before the recipient’s bank fully processes it. Chargebacks are typically initiated when there is a dispute regarding a transaction.

When Do Chargebacks Occur?

Chargebacks can be triggered under the following circumstances:

  1. Unrecognized Transactions – A customer does not recall or recognize a transaction on their account.
  2. Disputed Transactions – A customer raises a complaint about a payment with their bank.
  3. Non-Delivery of Goods/Services – A customer is charged for an item that was never delivered.
  4. Processing Errors – A transaction is processed twice due to a technical error.
  5. Duplicate Charges – A merchant accidentally charges a customer multiple times for the same purchase.

Chargeback vs. Refund: What’s the Difference?

Many people confuse chargebacks with refunds, but they are two distinct processes:

  • A refund occurs when a customer directly requests the merchant or payment service provider (such as a upi app) to return their money.
  • A chargeback, on the other hand, is initiated by the bank when a customer disputes a transaction, and the bank investigates before processing the reversal.

While refunds are a more straightforward process handled between the merchant and the customer, chargebacks involve multiple banks and regulatory processes, making them more complex.

Why Are These Changes Needed?

Currently, chargebacks can be initiated on the same day as the transaction, leading to multiple challenges:

  • Banks often do not have enough time to verify and process returns before chargebacks are raised.
  • Some banks mistakenly initiate refund requests without checking if a chargeback is already in process.
  • In such cases, chargebacks are automatically accepted on a deemed approval basis, which can result in penalties from the Reserve Bank of India (RBI).

By introducing automated acceptance and rejection, NPCI aims to:
Reduce the time taken to resolve disputes.
Minimize errors caused by manual processing.
Prevent unnecessary penalties due to mismanagement of chargebacks.
Streamline the UPI ecosystem for both banks and customers.

How Will This Affect Customers?

For regular upi users, this change will not directly impact how they make payments or raise disputes. The improvements are being made behind the scenes to ensure that chargebacks are processed more efficiently.

  • If a customer raises a dispute, their bank will still handle it as before.
  • The difference is that banks will now have an automated system to decide whether the chargeback should be approved or rejected based on TCC and return data.

Final Thoughts

With upi being one of the most widely used digital payment systems in India, ensuring a smooth and error-free chargeback process is crucial. These new changes will help banks and payment providers handle disputes more effectively, ultimately enhancing trust in the UPI ecosystem.

As the February 15 implementation date approaches, banks and payment service providers will update their systems to comply with the new guidelines, ensuring a faster and more efficient chargeback resolution process for all stakeholders.

SEBI Secure UPI Payment Framework for Market Intermediaries

The Securities and Exchange Board of India (SEBI) has proposed a significant enhancement to the UPI (Unified Payments Interface) payment system for capital market transactions. This move aims to strengthen investor security, reduce fraudulent activities, and improve payment transparency by ensuring that funds are directed only to legitimate, SEBI-registered market intermediaries.

The proposal introduces multiple security features, including unique UPI IDs for registered intermediaries, a verification icon for payment authentication, and an increased daily UPI transaction limit of ₹5 lakh. The changes seek to create a secure and streamlined environment for investors engaging in stock trading, mutual fund investments, and other financial activities within the capital markets.


Key Features of the Proposed UPI Mechanism

SEBI plans to assign each registered market intermediary a unique alphanumeric UPI ID. This identifier will help investors verify the authenticity of intermediaries before making payments. It serves as a critical layer of protection against fraud, as unregistered entities often mislead investors and collect funds unlawfully.

Verification Icon for Payment Authenticity

To further enhance security, SEBI proposes a distinct verification icon—a “thumbs-up” symbol within a green triangle—that will appear when payments are made to verified intermediaries. This visual indicator will assure investors that their funds are being directed to legitimate entities.

If this verification icon is missing, investors will be alerted that the intermediary may not be registered with SEBI, signaling potential fraud.

Increased Daily UPI Transaction Limit

To facilitate higher-value transactions securely, SEBI proposes raising the current UPI transaction limit from ₹2 lakh to ₹5 lakh per day. This change will be implemented in collaboration with the National Payments Corporation of India (NPCI), which operates the UPI framework.

The increased transaction limit will be particularly beneficial for investors making large-scale investments in stock trading, mutual funds, and other financial instruments. SEBI has indicated that the limit will be reviewed periodically to ensure it continues to meet market demands.


Addressing Rising Fraud in Capital Markets

Since 2019, when SEBI permitted UPI payments in the securities market, the number of fraudulent activities involving unregistered entities has grown. These entities often impersonate legitimate market intermediaries, collecting funds from unsuspecting investors under false pretenses.

SEBI’s proposed secure UPI payment framework is a response to these increasing risks. By introducing unique UPI IDs and a verification system, SEBI aims to minimize fraud and foster greater trust in digital transactions within the capital markets.


How Will These Changes Benefit Investors?

  1. Enhanced Security:
    The unique UPI ID and verification icon will help investors confidently identify legitimate intermediaries and avoid fraudulent transactions.
  2. Higher Transaction Limits:
    The increased UPI limit of ₹5 lakh per day will enable smoother and safer high-value transactions, reducing the need for traditional payment methods that may involve longer processing times.
  3. Greater Transparency:
    By directing payments solely to registered market intermediaries, SEBI’s framework will promote transparency and accountability in financial transactions.
  4. Reduced Fraud:
    The mechanism will act as a deterrent against unregistered entities attempting to deceive investors.

Public Consultation and Stakeholder Involvement

To ensure a well-rounded and effective implementation, SEBI has invited public comments on the proposal until February 21, 2025. This consultation period allows stakeholders, including investors, market intermediaries, and industry experts, to share their feedback and suggestions.

By seeking public input, SEBI aims to develop a payment mechanism that aligns with the needs of the capital markets while safeguarding investor interests.


Conclusion

SEBI’s proposal for a secure UPI payment mechanism underscores its commitment to strengthening investor protection and enhancing market transparency. The introduction of unique UPI IDs, verification icons, and higher transaction limits marks a significant step forward in creating a safe and efficient payment ecosystem for capital market transactions.

As SEBI works to finalize the framework, collaboration with stakeholders and adherence to robust security measures will be crucial in building a trusted digital financial environment.

HDFC Bank UPI services are currently unavailable

HDFC Bank has issued a notification informing customers about the temporary unavailability of its Unified Payments Interface (UPI) services due to scheduled system maintenance. This service suspension is necessary to improve system performance and ensure a smoother transaction experience in the future.

Key Details:

  • Date: February 8, 2025
  • Downtime: 12:00 AM to 3:00 AM (Saturday)
  • Duration: 3 hours
  • Affected Services:
    • UPI transactions for current and savings account holders
    • Payments and transactions involving RuPay credit cards linked to UPI

During the maintenance window, customers will not be able to initiate or complete UPI-based transactions. This includes peer-to-peer transfers, bill payments, merchant transactions, and other UPI-related services through HDFC Bank’s platform.

Advice to Customers:
To avoid disruptions, customers are strongly encouraged to plan and complete any critical transactions before the maintenance period. This will help ensure a seamless banking experience without interruptions during the downtime.

Customer Support:
HDFC Bank remains committed to providing assistance to its customers. In case of any queries or concerns, customers can reach out to the bank’s customer service helpline or use alternative payment methods during the affected hours.

The bank appreciates the understanding and cooperation of its customers as it works to enhance its digital payment infrastructure for a better service experience.

How UPI, Credit Cards, and Other Transactions Will Be Affected

As February 2025 begins, a series of significant regulatory changes are now in effect, reshaping how customers interact with banking and financial services. These changes, effective from February 1, 2025, cover a broad range of financial activities, including ATM withdrawals, Unified Payments Interface (upi) transactions, and other core banking services. Consumers are encouraged to be aware of these updates, as they could impact everything from digital payments to daily banking operations.

Key Financial Changes in February

UPI Transaction ID Update

Effective February 1, 2025, the National Payments Corporation of India (NPCI) has introduced a new mandate that all Unified Payments Interface (upi) transaction IDs must be alphanumeric. This change aims to enhance the standardization and security of UPI transactions, ensuring they are easier to track and process. By adopting a uniform format, the NPCI hopes to improve the clarity and consistency of UPI transactions. As a result, transactions that don’t comply with the new alphanumeric format will be automatically rejected by the system. This means users must ensure that their UPI apps are updated and in compliance with the new format to avoid any disruption in their transactions.

Revised Minimum Balance Requirements

Several major banks have revised their minimum balance requirements for savings accounts, with penalties now applicable for customers who fall below the new thresholds. These changes affect both urban and rural banking customers:

  • State Bank of India (SBI) has increased its minimum balance requirement to Rs 5,000 (up from Rs 3,000).
  • Punjab National Bank (PNB) now mandates a minimum balance of Rs 3,500 (up from Rs 1,000).
  • Canara Bank has raised its minimum balance requirement to Rs 2,500 (up from Rs 1,000).
    Account holders failing to maintain the required balance will incur penalty charges. These changes may affect customers who are used to maintaining lower balances in their savings accounts, so it’s important to check account terms and stay updated to avoid penalties.

Kotak Mahindra Bank 811 Savings Account Updates

Effective February 1, 2025, Kotak Mahindra Bank has revised its 811 digital savings account policies. These changes are primarily focused on fees for transactions such as cash deposits and ATM withdrawals:

  • Cash deposits exceeding Rs 10,000 per month will now incur a fee of Rs 5 per Rs 1,000, with a minimum charge of Rs 50.
  • The ATM decline fee will now apply only for non-Kotak ATMs, charging Rs 25 per declined transaction.
  • The standing instruction failure fee has been reduced from Rs 200 to Rs 100.
    These changes make it important for Kotak Mahindra 811 account holders to plan their transactions and avoid unnecessary charges. Regularly reviewing the terms and conditions of the savings account could help customers better manage fees and make the most of their banking experience.

IDFC FIRST Credit Card Changes

IDFC FIRST Bank has also introduced several updates to its credit card offerings, which will take effect from February 20, 2025. The changes mainly affect fees and services related to payments and card replacements:

  • Revised Statement Dates: The statement dates will now be revised, and customers will need to be aware of the new billing cycle.
  • New Fees on Education Payments: Payments made for educational expenses through platforms such as CRED and PayTM will now attract additional fees.
  • Card Replacement Fee: The fee for replacing a lost or damaged IDFC FIRST credit card will now be Rs 199, plus applicable taxes.
  • Joining and Annual Fees: A joining fee and annual fee of Rs 499 (plus taxes) will be introduced, effective after February 20, 2025.
    Credit cardholders are advised to check their accounts for the updated fees and ensure they are aware of the new charges for education payments, as this could impact payments made through third-party platforms.

RBI Monetary Policy Review on February 7

The Reserve Bank of India’s (RBI) Monetary Policy Committee will convene between February 5-7, 2025. Market experts are anticipating a potential cut in the repo rate, which would lower the interest rates at which commercial banks borrow from the central bank. This change would directly influence the rates for loans, mortgages, and deposits across all banks. If the RBI decides to reduce the repo rate, it could make borrowing cheaper, benefiting consumers who are looking to take out loans or credit, while savers may see lower returns on their fixed deposits and savings accounts. The RBI’s decision could also have an impact on inflation and the overall economic outlook, making it an important development for financial markets and consumers alike.


Why Staying Informed Matters

These regulatory changes signal a shift in the landscape of personal finance and banking in India, and it’s essential for consumers to stay informed about how these adjustments may affect their day-to-day transactions. From revised fees and charges to new standards in digital payments, being aware of the updates can help individuals plan their financial activities more effectively and avoid unnecessary penalties or surprises. As India continues to evolve in its digital banking and payment systems, such changes are expected to play a key role in streamlining financial services for users across the country.

Budget 2025 Cuts Digital Payment Incentives

The lack of revenue generated from processing Unified Payments Interface (UPI) transactions, combined with a recent reduction in government subsidies aimed at promoting these transactions, has raised concerns across the digital payments industry. Industry stakeholders are now left wondering whether the reduced incentives will be enough to sustain the momentum of UPI’s widespread adoption, or if the government is paving the way for the introduction of a fee structure for UPI transactions in the near future.

The Union Budget 2025 has left the digital payment sector in a state of uncertainty by remaining largely silent on the subsidies that benefit banks, financial technology (fintech) firms, and other players in the payments ecosystem. The government’s decision to cut the financial year 2026 (FY26) budget allocation for promoting peer-to-merchant (P2M) UPI transactions and RuPay debit card payments has further amplified these concerns.

While UPI has revolutionized digital payments in India, making it more accessible and affordable for millions of users, the government’s reduced financial commitment signals a potential shift in its approach to funding and incentivizing the sector. The growing reliance on UPI as a primary payment mode has raised questions about its sustainability without substantial government support.

This budgetary reduction has led many to speculate whether the government is considering alternative funding mechanisms for UPI transactions, such as the introduction of transaction fees or a more comprehensive fee structure for digital payments. Such a shift would mark a significant change in the current model, which has been largely driven by incentives to both consumers and merchants, encouraging the adoption of UPI for everyday transactions.

As the industry grapples with these changes, fintech firms, banks, and payment providers will have to reassess their business models and the viability of scaling UPI-driven services without government subsidies. Meanwhile, users could face the potential of additional fees if the government moves towards a more fee-based structure in the coming years, leaving them questioning the future of India’s most popular digital payment system.

Scaling UPI and RuPay Card Launch

MobiKwik Shifts Focus to UPI Expansion and RuPay Credit Card Launch to Boost Growth

Fintech platform MobiKwik is strengthening its focus on scaling its UPI (Unified Payments Interface) business and preparing to launch a RuPay credit card to the public as part of its strategy to drive long-term growth. Upasana Taku, the executive director, co-founder, and CFO of MobiKwik, emphasized these priorities during the company’s analyst call following its Q3 FY25 earnings report.

“The IPO provided us with ₹572 crore, and we are strategically planning its allocation to double down on existing business lines while investing in new ones that offer long-term growth potential,” Taku explained. She noted that the company is adopting a prudent approach to resource allocation, focusing on opportunities that will enhance operational efficiency and future profitability.

Financial Performance and Market Dynamics

MobiKwik reported a quarterly loss of ₹55 crore in Q3 FY25, a decline from the ₹5 crore profit it registered during the same period in Q3 FY24. However, revenue from operations grew to ₹269 crore in Q3 FY25, up from ₹229 crore year-over-year. For the nine months of FY25, the company generated ₹346 crore in revenue, surpassing its full-year FY24 figure of ₹317 crore.

Despite the short-term losses, MobiKwik remains optimistic. “We see green shoots, and we expect disbursals will come back to the same level as FY24, which will result in stronger margins and bottom-line performance in the quarters to come,” Taku said.

The company’s payments business grew by an impressive 166% in Q3 FY25, generating ₹196.5 crore in revenue. Taku highlighted a notable shift in revenue composition, with 73% of revenue in the first nine months of FY25 coming from payments, compared to 70% from financial product distribution in the previous year.

UPI and RuPay Credit Card Initiatives

To capitalize on the booming digital payments market, MobiKwik is aggressively expanding its UPI offerings. The company is focusing on scaling up Pocket UPI and credit card payments on UPI to drive growth. Pocket UPI allows users to make prepaid payments or pay with their wallet on any UPI QR code deployed by banks or payment companies. With MDR (merchant discount rates) attached to these transactions, it offers a potential revenue stream for the company.

“We started scaling up these products in 2024 and are already witnessing strong growth. Pocket UPI and credit card payments on UPI are critical for our growth trajectory,” Taku noted.

MobiKwik’s co-branded RuPay credit card, currently in beta on the MobiKwik app, is expected to be launched publicly soon. “This RuPay credit card will enable us to offer small-ticket credit for everyday spending on UPI, and it is also an MDR-generating product,” Taku said, emphasizing its potential to create a steady revenue stream.

Credit, Savings, and Insurance Expansion

On the lending side, MobiKwik is focused on balancing its credit distribution portfolio by introducing secured products, exploring new commercial models, and partnering with additional lending institutions. The company is scaling down its MobiKwik Zip product due to reduced lending partner appetite for small-ticket credit offerings but remains optimistic about the long-term potential of financial product distribution.

To enhance its offerings in savings and insurance, MobiKwik has made significant investments in Lens.ai, a digital advisory platform. “We are positioning Lens.ai as a digital advisor for the Markets of India, helping users invest via the MobiKwik app into mutual funds, fixed deposits, digital gold, and other financial products we plan to add,” Taku shared. Additionally, the company plans to launch its insurance distribution services later this year.

Strategic Partnerships and Industry Trends

MobiKwik recently partnered with Piramal Finance to offer personal loans, signaling its intent to diversify credit offerings despite scaling back Zip. This shift aligns with broader fintech trends, where companies are moving away from high-risk, small-ticket loans in favor of more stable and quality-focused credit products.

Appalla Saikiran, Founder & CEO of Scope, an invite-only networking platform with a fintech and gaming-focused venture capital fund worth $45 million, commented on the strategic shift. “Scaling down products like Zip highlights a broader fintech trend—moving away from high-risk, small-ticket loans to focus on quality over quantity. Despite losses, MobiKwik’s shares surged post-IPO, indicating investor confidence in fintech’s long-term potential. The market seems to value growth potential and revenue scale over short-term profitability, especially for firms demonstrating strong operational metrics,” Saikiran said.

A Strategic Pivot for Sustainable Growth

Founded in 2009 by Bipin Preet Singh and Upasana Taku, MobiKwik currently serves 172 million registered users and 4.5 million merchants, offering a wide range of payment products such as MobiKwik Wallet, UPI, Pocket UPI, and Zaakpay (payment gateway). The fintech startup has also ventured into distributing credit, savings, investment, and insurance products on its platform.

MobiKwik’s renewed focus on scaling its payments business, diversifying financial products, and launching the RuPay credit card underscores its strategic pivot to secure steady income streams and navigate market challenges. With a strong emphasis on operational efficiency and strategic investments, the company is positioning itself for long-term growth in the competitive fintech landscape.

UPI transactions will be disabled from February 1, 2025

The National Payments Corporation of India (NPCI) has announced a critical update for Unified Payments Interface (UPI) transactions. Effective February 1, 2025, UPI apps that generate transaction IDs containing special characters will face disruptions as these transactions will be declined by the central system. The move is aimed at improving system efficiency, standardizing transaction processes, and enhancing security across the UPI ecosystem.

Why the Change?

In an official circular dated January 9, 2025, NPCI emphasized the need for uniformity in UPI transaction ID formats. According to the circular:

“Considering the criticality of compliance to the specifications, it has been decided not to allow any special characters in UPI transaction IDs. Any transaction with an ID containing special characters shall be declined by the central system. This shall be effective from February 1, 2025.”

The decision follows a previous directive issued on March 28, 2024, where NPCI instructed payment service providers (PSPs) to adopt a standardized 35-digit alphanumeric format for transaction IDs. Despite significant progress in compliance, some payment ecosystem players continue to use special characters in transaction IDs, prompting NPCI to enforce stricter measures.

Impact on Consumers and Businesses

For UPI users, this directive means that transactions made through non-compliant apps will no longer be processed. Apps that fail to conform to the updated requirements will be unable to facilitate payments from February 1, 2025.

Mohan K, Founder of TechFini, explained the rationale behind the move:

UPI transactions containing special characters in their transaction IDs will be declined by the central system. Only transaction IDs that follow an alphanumeric format will be processed successfully. This move aims to enhance system efficiency, prevent potential security vulnerabilities, and ensure uniformity across UPI transactions.”

Alok Singh, Executive Vice President at Ongo (AGS Transact), highlighted the compliance status:

“Most major payment ecosystem players have already complied with the NPCI directive regarding 35-digit alphanumeric transaction IDs. However, some PSPs remain non-compliant. Consumers using these non-compliant apps will face transaction failures post-February 1, 2025.”

Rahul Jain, CFO at NTT DATA Payment Services India, emphasized NPCI’s ample notice period:

“The NPCI has provided sufficient time for industry players to transition and adhere to UPI technical criteria. Transactions with special characters will be rejected after the deadline. Given the current state of preparedness, most players have already ensured compliance to avoid disruptions.”

Additional NPCI Guidelines

  1. Transaction ID Length:
    • All UPI transaction IDs must be exactly 35 characters long and consist only of alphanumeric characters.
    • NPCI mandates validation at the central system level to reject any transaction IDs not meeting these specifications.
  2. Duplicate Transaction IDs:
    • Duplicate transaction IDs have caused settlement issues and customer dissatisfaction. NPCI has reinforced the validation process to prevent such occurrences.
    • In cases where duplicate IDs are processed by the central system, the liability will fall on the defaulting PSP.
  3. Transaction Monitoring:
    • If successful transactions are not present in the raw data files provided by PSPs, beneficiary banks must hold the funds in the beneficiary account.
    • Such cases should be reported to NPCI for resolution.

Benefits of Standardization

Standardizing UPI transaction IDs is expected to resolve current inefficiencies in tracing unique transactions. Alok Singh from Ongo explained:

“With so many UPI apps generating transaction IDs using their own systems, it becomes challenging to trace transactions. Customers often face difficulties when quoting transaction IDs during complaints. A standardized 35-digit transaction ID can help identify PSPs, remitters, dates of transactions, and other key details.”

Mohan K from TechFini added:

“By eliminating special characters, UPI can streamline processing, reduce errors, and improve interoperability among banks and payment service providers. Merchants, payment gateways, and financial institutions must ensure that all transaction IDs generated or processed within their systems conform to the alphanumeric requirement to prevent payment failures.”

Consumer Action Required

UPI users are advised to ensure that the payment apps they use are compliant with the NPCI directive. If an app continues to generate transaction IDs with special characters after February 1, 2025, transactions will be declined by the central system, leading to potential payment disruptions.

This move by NPCI underscores its commitment to standardizing payment processes and enhancing the reliability of digital transactions across India.

Paytm UPI goes global: Shop, dine, and explore across borders.

One97 Communications Limited (OCL), the parent company behind the Paytm brand, has announced the launch of its new UPI International feature, enabling Paytm users to make Unified Payments Interface (UPI) payments at select international locations. This new service makes it easier for Indian travelers to make secure, cashless payments at destinations where UPI is accepted. The feature is available in a range of popular international locations, including the UAE, Singapore, France, Mauritius, Bhutan, and Nepal, allowing users to shop, dine, and explore without the need for cash or foreign credit cards.

“We’re excited to introduce UPI International to make it even more convenient for Indian travelers to enjoy seamless, cashless payments while abroad. With this feature, Paytm users can make payments in countries like the UAE, Singapore, France, Mauritius, Bhutan, and Nepal, where UPI is now accepted,” said a Paytm spokesperson. This expansion reflects Paytm’s commitment to improving the digital payments ecosystem, ensuring that users can enjoy the same ease of use internationally as they do at home.

Seamless Setup and Use

Setting up UPI International on the Paytm app is quick and easy. Users simply need to activate the service once, linking it to their bank account. After activation, the app automatically prompts users to use UPI when scanning a UPI-enabled QR code abroad. The process is designed to be intuitive, allowing users to pay effortlessly while traveling.

Travelers also have the option to choose a usage period for UPI International, ranging from 1 to 90 days, depending on the length of their trip. This flexibility ensures that users can tailor the service to fit their travel schedule. Furthermore, users can deactivate the service at any time, offering enhanced control over their transactions. This feature is particularly useful for preventing accidental payments to foreign merchants once users have returned to India, ensuring that they only make payments when they intend to.

Transparency and Control

Paytm has also incorporated full transparency into the payment process. During transactions, users can view the applicable foreign exchange rates and any conversion fees charged by their bank, ensuring that there are no hidden costs or surprises when completing the payment. This added layer of clarity helps users make informed decisions while managing their finances abroad.

In addition, UPI International offers travelers the ability to easily track their spending, providing them with greater control over their budget. This makes it easier for users to stay within their limits and avoid overspending while traveling.

Enhanced Payment Experience Across International Destinations

With UPI International, Paytm users can now enjoy a smoother and more convenient payment experience at iconic international destinations. Whether they’re shopping in the vibrant malls and markets of Dubai, exploring bustling street markets in Singapore, enjoying the beautiful beachside shops in Mauritius, or visiting artisanal craft stores in Bhutan and Nepal, travelers can make secure, cashless payments through the Paytm app wherever UPI is accepted. This enhances the overall travel experience, eliminating the need to carry cash or constantly convert currencies.

“As the holiday season approaches, we’re confident that this new feature will make international travel even more convenient for our users. This launch is another step towards enhancing the Paytm ecosystem and providing our customers with a seamless, digital-first payment solution, no matter where they are in the world,” the Paytm spokesperson added.

Managing Finances with Ease

In addition to the UPI International feature, Paytm recently launched the UPI statement download feature. This new tool allows users to access detailed transaction records in a clear and user-friendly format. This feature is particularly helpful for travelers, as it helps them track their spending, monitor exchange rates, and keep a record of all their international transactions. This functionality supports effective budgeting and financial management, allowing users to stay on top of their expenses during and after their trip.

Overall, the introduction of UPI International and other recent features highlights Paytm’s commitment to making digital payments more accessible and convenient for Indian users, both at home and abroad. As digital payment adoption continues to grow, Paytm is positioning itself as a leader in providing seamless, borderless payment experiences for Indian consumers across the globe.

NPCI undecided on enforcing 30% UPI market cap by 2024 end.

PhonePe and Google Pay maintain dominance in UPI market. The National Payments Corporation of India (NPCI) has not yet decided whether it will implement a 30% market share cap for payment platforms offering Unified Payments Interface (UPI) services by the end of 2024. This statement was made by NPCI’s Managing Director and CEO, Dilip Asbe, on Tuesday. Asbe clarified that a decision on the matter has not been made yet, adding, “The decision is yet to be taken. I don’t think I can comment on that (imposition of 30% cap).”

Asbe also commented on the increasing number of UPI app providers entering the market. He mentioned that many leading banks, including the State Bank of India (SBI) with its Yono app, have upgraded their platforms to integrate UPI functionality. “We have started seeing more app providers coming into play. Now, all leading banks, including SBI (Yono app), have modified their apps to be UPI apps. Obviously, it is going to take time, we are aware of that,” he added.

Market Domination

As of October, PhonePe and Google Pay continue to dominate the UPI market, holding a combined share of over 85% of the total transaction volume, according to data shared by NPCI. Paytm, the third-largest payment app by transaction volume, had a market share of 7% during the same period, while apps ranking below the third position had less than 1% of the total market share. This indicates the significant market power that PhonePe and Google Pay hold in the UPI space, with the top two players continuing to vastly outpace their competitors in terms of transaction volume.

Potential 40% Market Share Cap

Reports from TechCrunch suggest that NPCI is considering increasing the market share cap for UPI operators, possibly raising the limit to 40% or higher. This would apply to the market share that any single UPI provider could hold, particularly as the top two players continue to dominate. Originally, NPCI proposed a 30% cap on the market share for third-party UPI apps in November 2020. This cap was introduced as a measure to promote competition and prevent market monopolization. The deadline for implementing the cap, which was initially set for December 2022, has since been extended to December 2024, reflecting the complexity of implementing such a regulatory measure in a rapidly growing digital payments ecosystem.

UPI Growth and Record Transaction Volume

India’s UPI system achieved a major milestone in October, setting a new record with a total of 16.58 billion transactions, valued at ₹23.50 lakh crore. This surge was largely driven by the festive season, which boosted consumer spending and contributed to a 45% year-on-year increase in UPI transactions. The growth in UPI usage reflects its increasing importance as a primary mode of payment in India, with both person-to-person (P2P) and person-to-merchant (P2M) transactions continuing to rise steadily.

While P2P transactions account for the majority of the transaction value, the growth in P2M transactions is also notable. Leading banks in the UPI ecosystem, such as the State Bank of India (SBI), HDFC Bank, and YES Bank, are the top remitters and beneficiaries in the system, playing a crucial role in driving the volume and adoption of UPI.

The continued dominance of major payment platforms like PhonePe and Google Pay, along with the potential changes to market share caps, highlights the dynamic and evolving landscape of the digital payments industry in India. The future of UPI will likely depend on how NPCI addresses the competitive balance in the market, particularly as more players join the ecosystem and consumer adoption grows further.

Mercedes-Benz India MD & CEO emphasizes the need for a transformative “UPI moment” in the EV charging ecosystem

Santosh Iyer, Managing Director & CEO of Mercedes-Benz India, has called for a transformative “UPI moment” for the Electric Vehicle (EV) charging ecosystem. He highlighted the need for an all-in-one Battery Electric Vehicle (BEV) charging application that works seamlessly at home, in offices, around town, and on the road to accelerate EV adoption. Drawing parallels to India’s Unified Payments Interface (UPI), Iyer proposed the creation of a unified app integrating multiple charging points, enabling users to charge vehicles and pay effortlessly across the country.

“The charging infrastructure is expanding with private players entering the space. However, the biggest challenge is the reliance on multiple apps for vehicle charging. While there are aggregators, the process remains cumbersome,” Iyer said during a fireside chat at the Green Bharat e-Mobility Summit, organized by Network18 in collaboration with Ola Electric Mobility. He emphasized the importance of a policy framework to streamline the ecosystem, allowing for a single app to locate chargers, book slots, and facilitate seamless payments.

Iyer noted that such an approach would alleviate the challenges associated with EV charging and cited the example of the Mercedes Me app offered to EV customers overseas. He added, “If a car can locate the right charger, book an appointment, and make payments on its own, the entire experience becomes seamless. With India’s strong digitalization push, the country has the potential to create a global charging framework.”

The Mercedes-Benz India head also addressed broader policy challenges, including India’s two-tier tax structure—GST and state road taxes, which vary between 18% and 20%. He urged the government to adopt a standardized EV policy, offering support until EVs achieve a significant market share, such as 30% of total sales. “Without consistent taxation policies, EV penetration will remain limited,” he stated.

Iyer further underscored the automotive industry’s responsibility to decarbonize, revealing the company’s ambition to achieve an all-electric fleet in select markets by 2030. However, he acknowledged that customer adoption rates remain slow, pointing to the need for coordinated efforts from governments, industry stakeholders, and consumers.

He also highlighted Free Trade Agreements (FTAs) and reduced taxes on premium cars as avenues to boost EV exports from India. “To build world-class cars adhering to global standards, we need an open trading environment and a supportive taxation structure. This would enable scale and create opportunities for India to become an export hub,” he explained.

Finally, Iyer noted the instrumental role of Mercedes-Benz India’s R&D center in Bangalore in shaping the company’s global EV strategy. “Our software-defined cars and proprietary operating system are being developed by our team in Bangalore. The center is also contributing to AI-driven battery management systems and advanced safety technologies,” he said.