UPI market share cap delay likely to keep pay pie unchanged
ET reported on April 17 that new entrants have been withholding major investments in UPI, waiting to get a sense of the market share rule. PhonePe and Google Pay dominate UPI payments.
The government, though, is yet to indicate its official stand to the National Payments Corporation of India (NPCI), which manages the UPI railroad.
Users’ preference
People cited earlier said the regulator is also of the view that newer players haven’t made a dent on the concentration of UPI users with the leading duo, leaving it with few options on implementing the December 31 deadline.
NPCI and the ministry of electronics and information technology didn’t respond to queries.
“We have been told in multiple conversations that it’s not happening. Thus, we are figuring out plans,” said a senior executive at one of the smaller UPI apps, adding that the needle won’t move for recent entrants, given the Google Pay-PhonePe market sway. “This is not ideal, but it is what it is. Implementing this rule (market cap) will require advance planning, and it can’t be done in a day because it will be too disruptive.”
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The growth of UPI–which hit 14 billion monthly transactions in May–is also a core focus area for the government as well as NPCI. “What can be done if users continue to stick to just two to three platforms? So many new players are allowed to operate, but they are not being able to make any difference yet,” said one of the persons quoted earlier.
Walmart’s PhonePe
