UPI transactions soar to 145B in H1 FY27
What's the story
The National Payments Corporation of India (NPCI) has reported a massive jump in Unified Payments Interface (UPI) transactions. The data shows that the platform processed around 145 billion transactions in the first half of FY27, a whopping 27% increase from the same period last year when it recorded some 114 billion. The total value of these transactions also saw a significant increase, rising by about 20% to ₹177 lakh crore from ₹148 lakh crore last year.
Monthly decline
Slight decline observed in September
Despite the impressive growth in H1 FY27, September 2026 saw a slight decline in both transaction volume and value.
The total number of transactions for the month was 24.07 billion, down by 1.7% from August's 24.5 billion.
Similarly, the total value also decreased to ₹29.37 lakh crore from last month's ₹29.82 lakh crore, a drop of about 1.5%.
However, it's important to note August had one more day than September this year which could account for some of this decline.
Fee introduction
New Merchant Discount Rate to take effect from October 15
The NPCI data comes just two weeks ahead of the implementation of a new Merchant Discount Rate (MDR) on certain high-value UPI payments.
Starting October 15, merchants will be charged an MDR of 0.4% on transactions over ₹2,000.
However, this charge will not apply to person-to-person transactions, which will remain free regardless of amount involved.
The move is aimed at creating a sustainable revenue model for the digital payments ecosystem in India.
Revenue sharing
MDR fee sharing details
The MDR fee will be shared among various players in the UPI ecosystem.
According to reports, 40% of the total amount collected through this fee will go to customers' banks, 30% to payment gateways, 20% to UPI apps, and the remaining 10% will be given to sponsoring banks of these apps.
Notably, while merchants will bear this charge (not consumers), it is capped at ₹300 for transactions worth ₹75,000 or more.
Global reach
UPI's journey and international expansion
UPI's reach has expanded beyond India, with the payment system now accepted in 11 countries including Uzbekistan, Singapore, UAE, France, Mauritius, Nepal, Bhutan, Qatar, Sri Lanka, Cambodia, and Greece.
Launched on August 25, 2016, UPI has transformed India's digital payments landscape.
Transaction values have skyrocketed from ₹0.07 lakh crore in FY17 to around ₹314 lakh crore in FY26, a staggering increase of over 4,000 times over a decade!