UPI Processed 24.07 Billion Transactions In September, Two Weeks Before It Starts Charging

UPI processed 24.07 billion transactions worth ₹29.37 lakh crore in September, according to NPCI data.

Volume fell 1.8 per cent from the record 24.51 billion transactions in August, and value declined 1.5 per cent from ₹29.82 lakh crore. The drop reflects the calendar: August had 31 days and September 30.

On a daily basis both measures rose. UPI averaged 802 million transactions a day in September against 791 million in August, an increase of 1.4 per cent, while average daily value rose to ₹97,913 crore from ₹96,205 crore.

Year on year, volume grew 23 per cent and value 18 per cent.

The system crossed 23 billion monthly transactions for the first time in May 2026, with 23.2 billion worth ₹29.90 lakh crore, then processed 23.66 billion in July before reaching the August record.

NPCI has not yet published the app-wise breakdown for September. In August, PhonePe led on volume with 45.64 per cent, followed by Google Pay at 32.26 per cent and Paytm at 8.03 per cent, the three together accounting for 85.93 per cent. On value, PhonePe held 47.82 per cent, Google Pay 33.78 per cent and Paytm 6.87 per cent.

The merchant discount rate framework takes effect on 15 October, applying 0.4 per cent to specified person-to-merchant transactions above ₹2,000, capped at ₹300 for payments of ₹75,000 and above. Transactions up to ₹2,000 and person-to-person transfers remain outside the levy. The Supreme Court declined to stay the rollout on 28 September while issuing notices to the Centre, the Reserve Bank and NPCI, with responses due within four weeks.

The headline decline is not a decline, and the distinction is worth making because this number is about to be scrutinised closely.

August had 31 days. September had 30. That alone accounts for roughly 3 per cent of volume, which is more than the 1.8 per cent fall reported. Measured per day, UPI grew: 802 million transactions against 791 million, and ₹97,913 crore of value against ₹96,205 crore.

The month-on-month figure will nonetheless be quoted, and it will be quoted again in early November when October's data arrives covering the first fortnight of merchant charges. Anyone comparing those two months needs the daily series rather than the monthly one, because October has 31 days and will show an increase for the same arithmetic reason September showed a fall.

The year-on-year numbers are the cleaner read. Volume up 23 per cent, value up 18 per cent. Both are strong, and the gap between them is the more informative part: transactions are growing faster than the money moving through them, so the average payment keeps getting smaller.

That has been the shape of UPI's growth throughout. It started as a way to move meaningful sums and became the default for paying for tea.

September is the last clean month of data before the system changes, and that makes it worth keeping.

From 15 October, payments above ₹2,000 to merchants start carrying a charge. The government says about 4 per cent of merchant transactions are affected and 96 per cent are not. September's figures establish the baseline against which that claim will be tested.

The things to watch from November are specific. Whether the share of transactions just below ₹2,000 rises, which would indicate merchants or customers splitting payments to stay under the threshold. Whether growth in value decelerates faster than growth in volume, which would suggest larger payments moving elsewhere. And whether the ratio between the two shifts at all.

That last one matters because the existing trend already runs in one direction. Volume growing 23 per cent against value at 18 per cent means the average payment is shrinking, as UPI reaches further into small everyday transactions. MDR is designed to charge the larger payments, which are the part of the mix already growing more slowly.

For the apps the stakes are concentrated. PhonePe and Google Pay together handle more than three-quarters of volume and over 80 per cent of value, and have run that business without transaction revenue from person-to-merchant payments. A charge on the highest-value slice is the first real revenue line in the category.

Whether it compensates for the cost of running the rails is a separate question. Industry estimates put that cost at around ₹20,000 crore a year, and 0.4 per cent on roughly 4 per cent of merchant transactions does not obviously get there.

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