India now makes faster payments than any other country, says IMF
India now leads the world in faster payments, thanks to the widespread adoption of the Unified Payments Interface (UPI), according to a recent note from the International Monetary Fund (IMF).
Since its launch in 2016, UPI has witnessed exponential growth, while several indicators of cash usage have shown a declining trend. UPI now processes over 18 billion transactions per month, dominating the electronic retail payments ecosystem in India, the IMF noted in its paper titled “Growing Retail Digital Payments: The Value of Interoperability.”
UPI is an instant payments platform built on the Immediate Payment Service (IMPS) infrastructure and has revolutionized India’s digital payments landscape. The IMF emphasized that interoperability has significantly enhanced the user experience and driven broader adoption of digital payments.
“Interoperability directly increases users’ freedom to choose their favourite app, enabling them to take full advantage of the variety and quality of apps available. Interoperability can also facilitate entry by new providers and incentivise existing providers to upgrade their apps, offering indirect benefits to users,” said the IMF note.
The IMF pointed out that interoperability not only boosts user adoption but also makes digital payments more appealing compared to closed-loop systems, where payments are limited to a single provider’s network.
The note further added that providing infrastructure for interoperable systems or supporting them through regulation could be a promising strategy for countries aiming to shift from cash-based to digital economies.
The National Payments Corporation of India (NPCI) launched the Bharat Interface for Money (BHIM) app in late 2016, at a time when UPI usage was minimal and few providers existed in the market.
“Indeed, BHIM initially accounted for more than half of payer-side total transaction value, prior to the take-off of apps produced by major fintech firms. This highlights the potential catalytic role of direct public provision of payment apps,” according to the IMF note.
The public sector, the IMF noted, can help overcome coordination failures—such as the lack of user adoption due to limited high-quality apps, and the lack of high-quality apps due to low user adoption—thus kick-starting the ecosystem.
In terms of performance, UPI volumes in June 2025 recorded a 32% year-on-year growth, while transaction values rose 20% compared to June last year. The number of daily UPI transactions increased to 613 million in June, up from 602 million in May.
