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.

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.

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.

Digital payment transactions have seen remarkable growth in India over the past few years, with the adoption of platforms like UPI (Unified Payments Interface) revolutionizing the way payments are made. As digital payment solutions have become more mainstream, they have contributed significantly to enhancing financial inclusion and providing seamless transaction experiences. However, this unprecedented growth in digital payments has also given rise to a concerning increase in fraud-related activities.

Recent data shared by the Union Ministry of Finance in Parliament paints a worrying picture. The total monetary value of frauds related to UPI surged to ₹1,087 crore in the fiscal year 2023-24, which marks an alarming 89% increase compared to ₹573 crore in 2022-23. This dramatic rise in the value of UPI frauds highlights the growing vulnerability of digital payment systems to fraudulent activities.

Moreover, the number of fraud incidents linked to digital payments also saw a sharp spike. The number of payment-fraud cases nearly doubled, jumping from 725,000 in 2022-23 to 1.34 million in 2023-24. This means that every year, a greater number of people are falling victim to UPI-related scams, which are becoming more sophisticated and widespread. In just the first half of the 2024 financial year, India reported over 632,000 UPI fraud cases, underscoring the scale of the problem.

These incidents of fraud range from phishing scams to fake apps, SIM card swaps, and unauthorized transactions, all of which have been designed to exploit the vulnerabilities of users, often with dire consequences. As the volume of digital transactions continues to rise, fraudsters are also innovating, finding new ways to bypass security measures and defraud unsuspecting users.

The increasing frequency and scale of UPI frauds are a growing concern for both consumers and financial institutions. As digital payments become integral to everyday life, the rise in fraud is also beginning to erode trust in the security of these systems. If these trends continue unchecked, users may become more hesitant to embrace digital payment methods, potentially hindering the progress India has made toward a cashless economy.

To mitigate these risks, there is a pressing need for more robust security measures, better user education on digital safety practices, and improved regulatory oversight. Banks and payment service providers must work together to enhance the security of UPI transactions, introducing stronger authentication methods and monitoring for suspicious activity. Without these efforts, the rising cases of fraud could undermine the immense benefits digital payments offer, impacting both users’ confidence and the future growth of the sector.

1. Unprecedented Growth in Digital Payments: India has witnessed significant growth in digital payment transactions, particularly through platforms like UPI, driving financial inclusion and providing convenient payment options.
2. Surge in UPI Frauds: Alongside the rapid growth of digital payments, UPI frauds have surged. The value of UPI-related frauds increased by 89%, from ₹573 crore in 2022-23 to ₹1,087 crore in 2023-24.
3. Increase in Fraud Incidents: The number of UPI fraud cases nearly doubled, rising from 725,000 incidents in 2022-23 to 1.34 million in 2023-24, signaling a significant escalation in fraudulent activities.
4. Rising Fraud Cases in the Current Year: In the first half of 2024, over 632,000 UPI fraud cases were reported, showcasing the scale and ongoing nature of the problem.
5. Types of UPI Frauds: Fraudsters are employing various tactics, such as phishing scams, fake apps, SIM card swaps, and unauthorized transactions, to exploit user vulnerabilities.
6. Impact on Users’ Confidence: As fraud cases rise, users may become increasingly wary of digital payment systems, potentially reducing their trust in UPI and hindering the growth of cashless transactions.
7. Eroding Trust in Digital Payments: If UPI frauds continue to rise, it could negatively impact the broader acceptance of digital payment solutions, undermining the progress towards a cashless economy in India.
8. Need for Stronger Security Measures: To address the surge in frauds, there is an urgent need for enhanced security protocols, including stronger authentication methods, and better monitoring for suspicious activities in UPI transactions.
9. User Education on Digital Safety: Alongside improved security measures, educating users about safe practices in digital payments is essential to reduce the risk of falling victim to fraud.
10. Regulatory Oversight: Increased regulatory oversight and collaboration between banks, payment service providers, and law enforcement agencies are crucial to curb the rise in digital payment frauds and ensure a safer transaction environment for users.

On October 9, the Reserve Bank of India (RBI) announced an increase in the transaction limit for UPI 123Pay, raising it from ₹5,000 to ₹10,000. Alongside this, significant updates were introduced for UPI Lite wallets. The National Payments Corporation of India (NPCI) has issued guidelines for banks and service providers to comply with these changes.

What is UPI 123Pay?

UPI 123Pay is a digital payment solution designed for feature phones, allowing users to perform UPI transactions without needing internet access. It supports four payment methods:

• Interactive Voice Response (IVR) numbers
• Missed call-based transactions
• Apps embedded in feature phones by OEMs (Original Equipment Manufacturers)
• Proximity sound-based payments

This innovation promotes financial inclusion by enabling digital payments for users without smartphones or internet connectivity.

UPI Lite Wallet Updates

In addition to changes in UPI 123Pay, the RBI introduced updates for UPI Lite wallets:

• Wallet balance limit: Increased from ₹2,000 to ₹5,000.
• Per-transaction limit: Raised from ₹500 to ₹1,000.

Implementation Timeline for UPI 123Pay Changes

While the revised transaction limit for UPI 123Pay is effective immediately, the NPCI has set January 1, 2025, as the deadline for implementing additional updates.

Key Changes to Be Implemented by January 1, 2025

1. Increased Transaction Limit
   The transaction limit for UPI 123Pay will officially rise from ₹5,000 to ₹10,000.
2. Aadhaar OTP Onboarding
   Aadhaar-based OTP will become mandatory for onboarding users, ensuring enhanced security and streamlined authentication.
3. Transaction Tagging
   • Introduction of a new purpose code (86) for UPI 123Pay transactions.
   • All financial and non-financial transactions must include this code in the purpose tag.
   • The previous initiation mode (31) will be deprecated.
4. UPI Numeric ID Mapper Integration
   Banks and service providers must integrate with the UPI Numeric ID Mapper to enable functionality for UPI numbers, simplifying transaction processes.

Why These Changes Matter

RBI Governor Shaktikanta Das emphasized UPI’s transformative impact on India’s financial ecosystem, enhancing accessibility and inclusivity in digital payments. These updates aim to foster innovation, expand adoption of UPI-based solutions, and ensure the system meets the evolving needs of users across diverse segments.

In October 2024, the Unified Payments Interface (UPI) achieved a significant milestone, processing 16.58 billion transactions valued at ₹23.5 trillion, marking the highest volume and value since its inception in April 2016. This new record surpasses UPI’s previous peak of 15.04 billion transactions in September 2024 and ₹20.64 trillion in value recorded in July.

Growth Driven by Person-to-Merchant Transactions

The surge in UPI transactions was largely driven by person-to-merchant (P2M) payments, which saw a significant boost during the festival season in October. This marked the first time UPI crossed 16 billion transactions in volume and ₹23 trillion in value, highlighting the growing reliance on UPI for everyday purchases and services.

Compared to September 2024, October saw a 10% increase in volume and a 14% rise in transaction value. Data from the National Payments Corporation of India (NPCI) shows that 14.96 billion UPI transactions amounted to ₹20.61 trillion in August.

Daily Transaction Figures Soar

In October, daily UPI transactions reached a new high, crossing 535 million in volume and ₹75,801 crore in value, compared to 501 million transactions and ₹68,800 crore in September. Year-on-year, UPI transactions grew by 45% in volume and 37% in value.

Other Payment Systems Show Strong Growth

• IMPS (Immediate Payment Service): October saw 467 million IMPS transactions, a 9% increase from September, totaling ₹6.29 trillion—an 11% increase in value from the previous month.
• FASTag: The number of FASTag transactions grew by 8% in October, reaching 345 million transactions, worth ₹6,115 crore, compared to ₹5,620 crore in September.
• Aadhaar Enabled Payment System (AePS): October saw 126 million AePS transactions, a 26% increase from September, with the total value growing 35% to ₹32,493 crore.

Year-on-Year Growth Across Transactions

• IMPS: Volume grew by 5%, while value increased by 17% compared to October 2023.
• FASTag: Volume rose 8% and value by 10% year-on-year.
• AePS: A notable 26% increase in transaction volume and a 25% rise in value compared to October 2023.

The data underscores the growing adoption and trust in digital payment systems, with UPI leading the way in shaping India’s cashless economy.

India is solidifying its position as a global leader in digital payment technologies, with the internationalization of the Unified Payments Interface (UPI) progressing swiftly, according to a report by the Reserve Bank of India (RBI). The UPI achieved a significant milestone in October, recording 16.6 billion transactions in a single month, alongside notable improvements in its performance metrics.

Successful instant debit reversals, for example, increased to 86% in October 2024, up from 77% during the same period last year. Highlighting UPI’s capabilities, RBI Deputy Governor Michael Debabrata Patra noted its ability to integrate multiple bank accounts into a single mobile application, enabling seamless peer-to-peer (P2P) and person-to-merchant (P2M) interbank transactions.

Innovations Driving Digital Financial Growth

Patra highlighted other advancements complementing UPI’s success:

1. Account Aggregators and OCEN: Innovations such as the Account Aggregator framework and the Open Credit Enablement Network (OCEN) are driving productivity gains by streamlining access to digital credit.
2. ONDC Expansion: The Open Network for Digital Commerce (ONDC) now operates in over 720 cities, handling 49.72 million orders as of March 2024.
3. TReDS for MSMEs: The Trade Receivables Discounting System (TReDS) addresses the ₹52.2 trillion credit gap faced by MSMEs, reducing funding costs by up to 2.5 percentage points. The value of invoices financed through TReDS has grown over 23 times since its inception.

Rising Digital Adoption and Embedded Financing

India’s digital revolution is reaching wider demographics:

• Internet Usage: Approximately 40% of the rural population and 78% of people aged 20-30 actively use the internet.
• E-Commerce Growth: Around one-third of households engage in online purchases, with a growing share in categories such as consumer durables and food.

The emergence of embedded financing is reshaping the FinTech landscape. Its share in FinTech funding has grown from 2% in 2020 to 9% in 2024, indicating rising demand for integrated financial solutions.

Digitalisation Index Reflects Economic Transformation

To measure the impact of digitalization, the RBI has developed a Digitalization Index using a dynamic factor model (DFM). The index indicates steady growth, reflecting the ongoing transformation of India’s economy. This digital shift is also influencing monetary policy transmission, creating new research opportunities to understand its broader economic impact.

India’s Unique Position for Digital Leadership

India’s robust digital public infrastructure (DPI), a thriving information technology sector, and a burgeoning youth population—including one of the largest bases of AI talent—position the country to unlock new growth opportunities. According to Patra, these factors equip India to optimise existing resources and spearhead transformative global innovations.

As the UPI continues to gain international traction, India’s digital revolution sets a benchmark for other nations aspiring to leverage technology for economic growth and inclusion.

Paytm has unveiled a new UPI Lite auto top-up feature designed to simplify daily transactions for its users. This innovative service automatically replenishes the UPI Lite balance when it falls below a set threshold, ensuring a seamless experience for payments under ₹500. With this, Paytm continues to enhance its digital payment offerings, catering to the needs of users who rely on UPI for small-value transactions.

How the Feature Works

The UPI Lite auto top-up eliminates the hassle of manually reloading your UPI Lite balance. Users can set a predefined threshold, and when their balance dips below this limit, the system automatically recharges it with a predetermined amount from their linked bank account. This ensures uninterrupted payments without requiring constant monitoring or manual intervention.

Key Highlights of the UPI Lite Auto Top-Up

1. Designed for Small Payments:
   • Ideal for transactions under ₹500, such as groceries, snacks, or travel fares.
   • These payments do not require a PIN, making them faster and more convenient.
2. Hassle-Free Transactions:
   • Automatic top-ups save time and effort, ensuring users always have sufficient balance in their UPI Lite account.
3. Focus on Convenience:
   • Users can avoid delays caused by insufficient balance, especially for high-frequency, low-value transactions.
4. Secure Process:
   • The auto top-up feature operates within the secure framework of UPI Lite, offering a safe and reliable payment experience.

Paytm’s Recent Innovations in UPI

This launch follows Paytm’s introduction of international UPI transactions, enabling users to make payments in six countries, including Singapore, the UAE, and Mauritius. The integration of UPI Lite auto top-up complements this global expansion by strengthening its domestic digital payment ecosystem.

Benefits for Users

1. Seamless Payment Experience:
   • The auto-recharge function removes the inconvenience of running out of balance during crucial transactions.
2. Enhanced User Efficiency:
   • Users can focus on their daily activities without worrying about maintaining their payment balance.
3. No PIN Required for Payments:
   • Transactions under ₹500 made via UPI Lite are PIN-free, speeding up the payment process.
4. Encouraging Digital Adoption:
   • By simplifying small-value payments, Paytm is making digital payments more accessible to all user segments, including first-time adopters.

How to Activate the UPI Lite Auto Top-Up

• Step 1: Open the Paytm app and navigate to the UPI Lite settings.
• Step 2: Set a balance threshold that will trigger the auto top-up.
• Step 3: Specify the amount to be recharged automatically when the balance falls below the threshold.
• Step 4: Link your preferred bank account to enable the automatic recharge feature.

Once activated, the system will handle top-ups in the background, ensuring a consistent and uninterrupted payment experience.

Boosting UPI Adoption in India

The UPI Lite auto top-up feature aligns with India’s vision of increasing digital payment adoption across all demographics. With its focus on small-value transactions, this service aims to cater to millions of users, including those in tier-2 and tier-3 cities where digital payment usage is steadily growing.

As digital transactions become a part of everyday life, Paytm’s latest feature is expected to further strengthen its position as a leader in the UPI ecosystem, offering unparalleled convenience to its users.

RBI Raises UPI 123Pay Transaction Limit to ₹10,000 for Feature Phone Users

The Reserve Bank of India (RBI) has increased the transaction limit for UPI 123Pay from ₹5,000 to ₹10,000, empowering feature phone users to make higher-value digital payments. UPI 123Pay is specifically designed for individuals without internet access on their mobile phones, offering multiple ways to perform digital transactions seamlessly:

How UPI 123Pay Works

1. IVR (Interactive Voice Response): Users can complete transactions through a voice-based system by following simple instructions.
2. Missed Calls: Payments are triggered by dialing specific numbers and hanging up, initiating a secure payment process.
3. OEM (Original Equipment Manufacturer) Apps: Feature phone apps enable users to make transactions without requiring internet connectivity.
4. Sound-Based Technology: Sound waves are used to securely transmit payment information between devices.

Key Changes Introduced

1. Higher Transaction Limit:
   • The maximum transaction limit has been increased to ₹10,000, doubling the previous limit of ₹5,000.
2. Enhanced Security with Aadhaar OTP Authentication:
   • Aadhaar-based OTP authentication will be integrated into UPI 123Pay transactions to provide an additional layer of security.
3. Standardized Transaction Tagging:
   • A new purpose code (86) has been introduced to categorize and track UPI 123Pay transactions more efficiently.
4. Improved Initiation Modes:
   • UPI 123Pay now supports expanded initiation modes, including IVR, missed calls, feature phone apps, and sound-based payments.
5. UPI Number Functionality:
   • The system will enable payments using a unique UPI numeric ID mapper for added convenience.

Implementation Timeline

The National Payments Corporation of India (NPCI), which oversees UPI, has directed banks and service providers to adopt these changes immediately. Full compliance with the new guidelines is expected by January 1, 2025.

What is UPI 123Pay?

UPI 123Pay is a groundbreaking service that makes digital payments accessible to feature phone users who lack internet connectivity. By leveraging simple technologies such as IVR calls, missed calls, and sound-based communication, it bridges the gap between underserved populations and digital financial services.

Benefits of the Updates

1. Increased Convenience:
   • The higher transaction limit will allow users to make more significant payments while staying within the UPI ecosystem.
2. Enhanced Security:
   • Aadhaar OTP authentication strengthens transaction security, ensuring safer digital payments for feature phone users.
3. Streamlined User Experience:
   • Standardized tagging and expanded payment modes simplify the payment process, enhancing usability.

These updates aim to accelerate the adoption of digital payments across India, especially in rural and underserved regions, further contributing to the country’s financial inclusion goals.