Unified Payments Interface (UPI): Trends and Growth in India’s Digital Economy

The Unified Payments Interface (UPI) has emerged as a major component of India’s digital payment ecosystem, with substantial growth in transaction volume, transaction value and participating banks since its introduction. Although previous studies have examined the expansion, adoption and ecosystem of UPI, there is scope for an updated longitudinal assessment of its growth pattern and the association between bank participation and UPI transaction activity over an extended period. Against this background, the present study examines the trends and growth of UPI in India during the financial years 2016–17 to 2025–26 and analyses the association between participating banks and UPI transaction activity. The study is based on secondary data compiled from the National Payments Corporation of India (NPCI) and other relevant published sources. Descriptive statistics, year-wise trend analysis, annual growth rate (AGR), compound annual growth rate (CAGR), and Pearson correlation are employed to analyse the data. The findings indicate a substantial increase in UPI transaction volume and value over the study period, accompanied by a considerable expansion in the number of participating banks. The correlation analysis indicates a strong positive association between bank participation and both UPI transaction volume and transaction value. The study also identifies challenges related to digital literacy, digital infrastructure, cybersecurity, merchant awareness, and data privacy. The findings highlight the continued expansion of UPI and the importance of strengthening digital infrastructure, financial literacy, and payment security to support inclusive digital payment growth in India. Keywords: Unified Payments Interface (UPI), Digital Payments, Digital Economy, NPCI, Transaction Volume, Transaction Value, Participating Banks