- A large share of digital transactions with just a few apps could pose a threat to fintech innovation in the future
New Delhi: India has taken a big leap in the field of digital payments in the last few years. A new report by SBI Research shows that UPI (Unified Payments Interface) has now become the most important means of transaction among Indians. Be it common people or industrialists, small or big, all types of payments are being made through UPI.
According to the report, in the year 2025 alone, the average daily value of UPI transactions increased from Rs.75,743 crore in January to Rs.80,919 crore in July and Rs.90,446 crore in August. Similarly, the average daily volume increased by 127 million to 675 million between January and August.
The report said that SBI has become the largest remitter (bank that sends money) in the country, having done 5.2 billion transactions. This is 3.4 times more than the second largest bank HDFC. At the same time, Yes Bank has been the largest beneficiary bank, having done about 8 billion transactions.
Talking about UPI apps, PhonePe is at the forefront, followed by Google Pay and Paytm. The report warns that such a large share of transactions is concentrated on just a few apps, which could pose a threat to India-centric fintech innovation in the future. For this reason, the need for indigenous counter apps and AI-based infrastructure has also been emphasized.
According to the new data, Maharashtra is the number one state in digital payments with a 9.8% share. It is followed by Karnataka (5.5%) and Uttar Pradesh (5.3%). The share of payments to merchants (P2M) made through UPI has increased rapidly. It was only 13% in June 2020, while it increased to 29% in July 2025. In terms of volume, it has also increased from 39% to 64%. This shows the depth of financial inclusion and digital payments.
According to the report, the share of UPI in retail money i.e. UPI and ATM cash withdrawals has increased from 40% in November 2019 to 91% in May 2025. This simply means that people are now choosing UPI over cash.
