National Payments Corporation of India (NPCI) Reports Growth in Revenue

The National Payments Corporation of India is a key player in retail payment services, including UPI, IMPS, RuPay, BHIM, NACH, FASTag, and BBPS. In FY26, it recorded a significant 22% year-on-year increase in revenue. Nonetheless, the company experienced a profit decrease of 32% during the same period, primarily due to elevated deferred tax liabilities and an increase in promotional expenses, such as cashbacks and sponsorships.

Financial Performance Overview

According to the consolidated annual financial statements accessed by Startup Superb from its website, NPCI’s operational revenue rose from Rs 3,481 crore in FY25 to Rs 4,240 crore in the fiscal year ending March 2026. Established in 2008 as an initiative of the Reserve Bank of India and the Indian Banks’ Association, NPCI functions as the overarching body for retail payment and settlement systems across India. The company oversees major payment platforms and services, including UPI, IMPS, RuPay, BHIM, NACH, AePS, FASTag, and BBPS. Since its inception as a not-for-profit organization, NPCI treats its profits as surplus.

Revenue Breakdown

Payment services emerged as the main contributor to NPCI’s revenue in FY26, accounting for 88% of its total operational earnings. This segment saw a 16% increase, bringing its income from Rs 3,212 crore to Rs 3,736 crore from FY25 to FY26. The remaining operational revenue was derived from sources such as certification fees, network and implementation charges, membership fees, hologram charges, and card-related fees.

Additionally, NPCI attained Rs 633 crore from non-operational avenues in FY26, boosting its cumulative income to Rs 4,873 crore. This additional revenue stemmed from various sources, including liabilities written off, interest from income tax refunds, service guarantee mechanism receipts, and miscellaneous income.

Expenditure Overview

Marketing and product incentives represented NPCI’s largest expenditure category in FY26, making up over 47% of total costs. These expenses surged by 27%, rising from Rs 1,116 crore in FY25 to Rs 1,420 crore in FY26, driven by increased marketing activities and cashbacks. Marketing expenditures also encapsulated payments to banks for RuPay cards, promotional campaigns, B2B initiatives, and sponsorships.

Employee and Other Expenses

Employee benefit expenses climbed over 22% to reach Rs 534 crore in FY26, whereas depreciation and amortisation costs saw a considerable rise of 40%, amounting to Rs 408 crore. Operating expenses also escalated 39%, increasing from Rs 210 crore in FY25 to Rs 291 crore in FY26, due to heightened annual maintenance costs for IT and network infrastructure, alongside elevated data centre expenses.

Furthermore, various expenses such as travel, professional services, training, and seminars added to NPCI’s overall cost profile in the fiscal year. In total, the corporation’s expenses increased by 32%, growing from Rs 2,270 crore in FY25 to Rs 2,985 crore in FY26.

Impact on Profitability

As expenses exceeded revenue growth, NPCI’s net profit experienced considerable pressure in FY26. The notable increases in marketing, product incentives, and cashbacks, compounded with a deferred tax expense of Rs 331 crore, resulted in a 32% decline in surplus, down to Rs 991 crore from Rs 1,461 crore in FY25. The corporation’s EBITDA rose by 11%, reaching Rs 1,674 crore in FY26, with an EBITDA margin standing at 39.5%. The return on capital employed was recorded at 12.9%, with NPCI spending Rs 0.70 to earn one rupee in operating revenue during the year.

Financial Position at Year-End

By the end of March 2026, NPCI had total current assets amounting to Rs 8,081 crore, supported by a robust cash and bank balance of Rs 6,119 crore.