TL;DR
NPCI CEO says AI will drive UPI to a billion daily transactions via fraud detection, credit, and voice onboarding. PhonePe and Google Pay hold 80%+ share.
India’s Unified Payment Interface has grown to over 750 million daily transactions, and the head of the body that oversees it says AI will be central to reaching a billion. Dilip Asbe, MD and CEO of the National Payments Corporation of India, told TechCrunch at Mumbai Tech Week that AI could drive the next half billion users through fraud prevention, credit distribution, and multilingual voice onboarding.
“AI will be used very effectively when we look at the next wave of UPI, and that includes all aspects, including reaching new users,” Asbe said. “We must use AI effectively to protect our current citizens, to find fraud, and to find mules. AI must also be used to provide credit to all the users and merchants who have digital footprints.”
NPCI launched a voice assistant-based payment system in 2023, but Asbe acknowledged adoption has not taken off yet. He said voice models need to be more accurate before they become a critical component of the payment ecosystem. India has been debating its AI sovereignty more intensely in recent weeks, with proposals for a $5 billion annual sovereign AI fund and calls to build small language models tailored to local languages and use cases.
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Asbe sees an opportunity there. “We have a very rich data set in our ecosystem,” he said. “I think there is a big opportunity for Indian companies, the banks, FinTechs, and the ecosystem, to create small language models which are sharp, specific, and as deterministic as possible.” NPCI already launched a model called FIMI to resolve user disputes, which Asbe said now serves over a million users for cancelling mandates and resolving issues.
On regulation, Asbe said India can adopt AI-powered finance with the right protections. He wants systems that can trace the instructions and consent a user gave to an AI agent if something goes wrong. NPCI demonstrated agentic commerce and payments with Razorpay last year, but a wider rollout has not followed.
The UPI market remains heavily concentrated. PhonePe and Google Pay control over 80% of transaction share. A regulatory cap that would limit any single app to 30% is set to take effect on December 31, 2026, unless NPCI defers the deadline again. Asbe said switching costs between apps are low and that the concentration reflects the absence of a viable commercial model for newer entrants. “The moment we see the commercial model being available to the ecosystem, I believe newer players will start investing very heavily,” he said.
NPCI’s own app, BHIM, holds roughly 1% market share despite growing transaction volumes. Asbe said there is no specific share target for BHIM, but as India’s digital economy scales toward its largest-ever tech IPOs and $110 billion AI infrastructure plans, NPCI wants BHIM to serve as a sovereign and secure alternative.
