NPCI says AI will drive next phase of UPI growth

Dilip Asbe said newer UPI apps could become more competitive if they find a viable commercial model, and he argued that artificial intelligence will shape the next phase of India’s payments growth through user acquisition, fraud prevention and credit distribution. The message was clear: UPI’s next battle is no longer just about adding transactions, but about building the infrastructure and economics to support the next wave of users.

The scale already in place is large enough to make that shift consequential. NPCI’s UPI statistics showed 703 banks live on the network as of March 2026, while March set a record with 2,264 crore transactions worth 29.53 lakh crore. A Press Information Bureau release said UPI accounted for 85% of India’s digital payments in FY2025-26, underscoring how dominant the rail has become across the country’s consumer economy.

That scale is also why NPCI is leaning harder into AI. The organization announced FiMI, a domain-specific AI language model built for India’s payments ecosystem, and said it was already handling nearly one million UPI support-service transactions every month. NPCI also announced a collaboration with NVIDIA on February 18, 2026, to scale sovereign AI model capabilities for payments. Asbe has said NPCI expects to launch three or four small language models for different use cases in the coming months, and that India’s fintech ecosystem could build smaller models using domestic public datasets.

The commercial question, however, remains unresolved. Asbe has argued that UPI has become a foundational infrastructure layer for fintech startups and other industries, but that reaching the next 200 million to 300 million users will require support from the Reserve Bank of India, the government and the broader ecosystem. He has said India should bring another 200 million to 300 million people into UPI to “break their cash memory,” and has described the platform as capable of growing 10x from its current base.

That ambition comes as UPI continues to push into new territory. TechCrunch said the system had moved past 750 million daily transactions and that NPCI wants to take it above 1 billion daily transactions. NPCI’s own monthly data showed 720 million transactions in May 2026, with value of 23,201.93 crore that month. Asbe has also said the network still has room to expand on both merchant and consumer sides, including cross-border acceptance in countries such as Indonesia, Thailand and Malaysia.

For newer apps, that leaves a tougher test than raw volume. AI may improve fraud detection, support services and credit access, but the winners will still need a durable business model in a market where UPI has become the default and competition is shifting from reach to economics.