Global: India Extends Deadline for UPI Market Share Cap Implementation

India has once again delayed the implementation of a market share cap for third-party app providers operating on the Unified Payments Interface (UPI) system.

The National Payments Corporation of India (NPCI) has announced a two-year extension for enforcing the 30% market share limit, moving the deadline from the end of 2024 to late 2026. This marks the second postponement of the policy.

This decision significantly benefits major players like Google Pay and Walmart-backed PhonePe, which together dominate over 85% of UPI transactions in the country.

“Considering various factors, the timeline for existing TPAPs [third-party app providers] exceeding the volume cap is extended by two years,” stated the NPCI in its announcement.

Despite the dominance of Google Pay and PhonePe, competition in the UPI space may intensify as WhatsApp has recently been permitted to roll out its peer-to-peer payments service to its entire user base of 500 million in India.

The extension underscores ongoing challenges in balancing market growth with regulatory objectives in India’s booming digital payments ecosystem.