NPCI chief says AI and better economics will drive UPI growth

Dilip Asbe is betting that UPI’s next phase of growth will come from better economics, not just bigger scale. The National Payments Corporation of India chief said newer UPI apps could become more competitive if they can build viable commercial models, and he tied that argument to AI’s role in fraud detection, user growth, credit distribution and customer support.

The timing matters because UPI is already operating at a massive scale. NPCI’s official statistics show 720 billion transactions in May 2026, equal to about 737.8 million payments a day, with market commentary putting daily volume at roughly 748 million and describing the month as a record. That is a long way from January 2025, when Asbe said UPI had about 450 million users, around 200 million active daily users and roughly 17 billion transactions a month.

The central question now is whether that volume can support more than a handful of dominant apps. NPCI has extended the deadline for third-party UPI apps to comply with the 30% market-share cap until December 31, 2026, giving PhonePe, Google Pay and other major players more time. The concentration problem has lingered for years, and reports have put the two biggest apps at well over 80% of UPI transaction volume. Asbe has repeatedly said ecosystem diversity has been crucial to UPI’s rise, but his latest comments suggest diversity will only hold if the business model works for new entrants.

AI is now being presented as the tool that could make that model possible. In May 2026, Asbe argued for a regulatory framework for agentic AI in India’s fintech and payments ecosystem, saying the sector needs rules to support safe and orderly growth. NPCI has already moved ahead on the technology side: reports from February 2026 said it launched FiMI, a payments-focused AI model, and later reporting said FiMI was handling nearly one million UPI support-service transactions every month.

That push also fits NPCI’s longer-term ambition. The institution has said UPI could grow 10 times from its current base and has set a goal of reaching 1 billion daily transactions. At India AI Impact Summit 2026 and related discussions in Mumbai, Asbe and fintech executives including Pine Labs chief executive Amrish Rau framed India’s payments stack as a possible model for how public digital infrastructure and AI can combine. For UPI, the real test is whether AI can do more than add features and actually improve fraud control, merchant tools and credit underwriting enough to widen competition on a network famous for scale but thin margins.