UPI Transactions Grow 35% in H1 2025, Merchant Payments Soar 37% as Digital India Expands

India's digital payments ecosystem continues to gain momentum, as Unified Payments Interface (UPI) transaction volume and value witness sharp growth in the first half of 2025. Data from Worldline highlights the increasing adoption of UPI for daily transactions, particularly among merchants and small retailers.

UPI Transactions See Robust 35% Growth in H1 2025

Between January and June 2025, India recorded 106.36 billion UPI transactions, a 35% year-on-year increase. These were valued at ₹1,43,34,000 crore. The average ticket size of UPI transactions dropped from ₹1,478 in 2024 to ₹1,348 in 2025, reflecting higher usage for smaller, routine payments. This signals a behavioural shift towards cashless transactions for everyday purchases.

Merchant Transactions Lead the Surge

Person-to-merchant (P2M) UPI transactions grew 37% to 67.01 billion, revealing a significant boost in digital payments among Kirana shops and micro businesses. Worldline credits this rise to the “Kirana Effect”, pointing to increasing digital acceptance across India’s informal retail sector.

QR Code Ecosystem Expands Rapidly

India’s UPI QR network reached 678 million by June 2025, more than doubling since January 2024 with a 111% increase. Point-of-sale (PoS) terminals rose 29% to 1.12 crore, while Bharat QR registered a 12% rise to 6.72 million. These trends strengthen India’s position as the largest merchant acceptance network globally.

Read More: Paytm Enables NRIs to Use International Numbers for UPI Payments!

Shift in Card Usage and Mobile Payment Evolution

Credit card adoption remained healthy, with a 23% rise in outstanding cards. Monthly credit card spends touched ₹2,20,000 crore, although the average transaction value fell by 6%. Debit card usage at PoS declined 8% as low-value purchases shifted to UPI. Mobile payments surged 30% to 98.9 billion transactions worth ₹2,09,70,000 crore, underlining India’s mobile-first payment transition.

Emerging Innovations to Shape the Next Phase

The future of digital payments in India will be driven by advancements such as biometric UPI, chat-based transactions and expanded UPI corridors internationally. Technologies like SoftPoS and credit-on-UPI are set to increase financial inclusion and empower underserved segments.

Conclusion

India’s digital payment journey in H1 2025 highlights a deepening of financial penetration via UPI. Growth in transactions, merchant acceptance, and tech innovations all signify a strong foundation for continued expansion in the coming years.

Disclaimer: This blog has been written exclusively for educational purposes. The securities or companies mentioned are only examples and not recommendations. This does not constitute a personal recommendation or investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

Investments in securities are subject to market risks. Read all related documents carefully before investing.