The National Payments Corporation of India (NPCI) has announced an extension of the compliance deadline for the UPI market cap regulation by an additional two years, now set for December 31, 2026. This extension provides Third-Party Application Providers (TPAPs), which currently surpass the market share limit, the necessary time to conform to the regulatory framework.
As per the regulation implemented by NPCI in 2021, no single UPI application is permitted to represent more than 30% of the overall volume of UPI transactions. This guideline aims to deter market monopolies, promote healthy competition, and maintain the integrity of the UPI ecosystem.
Platforms like Google Pay and PhonePe, which together command a substantial portion of the UPI market—approximately 80%—stand to gain from this additional timeframe.
Additionally, the payments body has lifted the onboarding restrictions for Meta’s WhatsApp Pay, facilitating its growth in India. Initially, upon its launch, WhatsApp Pay was limited to onboarding only a small percentage of UPI users. NPCI has progressively increased this cap, reaching 100 million users by November 2022. The platform can now extend its services to its vast user base of 500 million in the country.
