UPI Transactions Rise 4% MoM To Record 24.51 Bn In August

UPI transactions touched a fresh all-time high in August, with transaction volume rising nearly 4% MoM to 24.51 Bn from 23.66 Bn in July. 

The transaction count grew 22% from 20.01 Bn in August 2025, according to the data released by the NPCI. 

However, the value of UPI transactions declined marginally to ₹29.82 Lakh Cr during the month under review from ₹29.88 Lakh Cr in July. On a YoY basis, transaction value increased 20%. 

The average daily transaction count rose to 791 Mn in August from 763 Mn in the preceding month. Meanwhile, the average daily transaction value declined 0.2% to ₹96,205 Cr from ₹96,383 Cr in July. 

The payments body will release the app-wise data later this month. In July, PhonePe processed 1,085.8 Cr transactions worth ₹14.4 Lakh Cr and Google Pay recorded 764.98 Cr transactions valued at ₹10 Lakh Cr.  

UPI’s Monetisation Question

The record transaction volume comes at a time when policymakers and industry players are looking to address structural challenges around the monetisation of UPI and competition within the ecosystem.

Last month, Parliament passed the Taxation and Other Laws (Amendment) Bill, 2026, replacing the blanket statutory bar on MDR for UPI and RuPay debit card transactions with a government-notified exemption framework.

The amendment does not itself impose MDR on any payment method. Instead, it empowers the Centre to specify which electronic payment methods will remain exempt from such charges, potentially paving the way for MDR to be introduced on certain UPI transactions.

The development is significant because UPI has historically operated under a zero-MDR regime for merchants. While the policy has helped drive adoption, it has left payments companies reliant on government incentives and adjacent financial services to monetise their vast transaction bases. 

Meanwhile, the NPCI is looking to improve UPI interoperability beyond basic payments.

The payments body is reportedly working on allowing users to port their existing UPI AutoPay mandates across UPI apps, while enabling merchants to shift recurring-payment mandates between payment providers.

The proposed changes could make it easier for consumers to switch UPI apps and for merchants to change payment providers without recreating existing mandates.

Separately, the finance ministry said yesterday that NPCI’s international arm NIPL signed an agreement with Uzbekistan’s national payment system HUMO to enable Indian travellers to make merchant payments by scanning the country’s UZQR codes through UPI-enabled apps. 

Meanwhile, UPI players are rolling out new products to expand their reach and defend their market share. Yesterday, PhonePe launched UPI payments for feature phones, allowing users to make digital payments without an internet connection.

The Walmart-owned fintech’s UPI 123Pay offering is aimed at bringing UPI capabilities to India’s more than 20 Cr feature-phone users.

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