In fierce UPI fight, new players Flipkart-backed Super.Money, Navi, Cred start to gain ground
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Newer Unified Payments Interface (UPI) apps such as Flipkart-backed Super.Money Navi , Bhim, and Cred are increasing their share in the payment market amid a spike in UPI transactions, luring consumers with cashback offers and other incentives.The newer entrants have grown their collective share to around 4% in March 2025 up from 2.3% in October 2024 and negligible a year earlier, according to data released by the National Payments Corporation of India (NPCI), which runs the UPI network.Even so, PhonePe and Google Pay continue their domination, holding on to a combined market share of 82%.PhonePe and Google Pay had 47% and 35% of the market, respectively, in the last two months, the data showed.'The newer apps are not offering pure-play payments; they are going beyond that with credit, ecommerce, and bill payments,' said Rohan Lakhaiyar, partner at Grant Thornton Bharat. 'UPI is their customer acquisition hook, and it seems to be working,' he said.Navi is focused on consumer lending, Cred is expanding unsecured loans and bill payments through Bharat Connect, and Super.Money is binding itself into Flipkart's ecommerce ecosystem.These firms are offering cashbacks and other incentives to move consumers away from their preferred apps at a time when the growth rate of UPI has slowed down. The payment network grew about 36% in 2023 and 2024, down from around 54% growth in 2022, albeit on a larger base, ET reported on April 7.Currently UPI is estimated to have more than 200 million active users.While Super.Money is offering up to 5% cashback on every UPI transaction, Navi is positioning UPI payments as a 'rewarding' experience, bundling features such as buy-now-pay-later through Navi Trezo. Cred had until recently promoted cashbacks for every Cred UPI transaction.NPCI-backed Bhim has also earmarked a separate budget to incentivise users through cashbacks, targeting the next 100-150 million UPI users, ET reported in August 2024 While these players are backed by large corporations or deep-pocketed venture capital firms, it remains to be seen how long they can sustain heavy incentive-driven growth.With the government recently slashing the subsidy budget on UPI payments to Rs 1,500 crore and restricting it only to 'small merchants', industry executives remain sceptical about generating sufficient revenue from this business.'Payments on UPI do not generate direct revenue. Fintechs are onboarding users to cross-sell revenue-generating services, which is the only way to justify their investment,' Lakhaiyar said.NPCI, though, has been nudging smaller apps to scale and challenge the dominance of Walmart-backed PhonePe and Google Pay.UPI transactions have risen sharply in the past two months to around 550-600 million daily in March and April. March recorded 18.3 billion UPI transactions, while April is expected to surpass 17.5 billion, according to NPCI data. Monthly volumes in the previous six months hovered between 15.5 billion and 16.5 billion.Some of this spike can be attributed to the rise of the new apps, industry insiders said.A senior banker at a private sector lender said gaming and betting transactions have increased during the ongoing Indian Premier League (IPL), with new UPI apps benefiting from this surge.Meanwhile, Paytm--whose associate entity Paytm Payments Bank suffered a series of setbacks including RBI restrictions last year--has held on to its 6.5-7% market share in consumer-facing UPI transactions in March and April, NPCI data shows.'As a listed company, Paytm has limited flexibility to spend heavily on cashbacks,' founder of a payments startup said, requesting anonymity. 'It needs to focus on profitability and has shifted its emphasis to the more lucrative merchant payments space,' the person added.While the new entrants are making early gains, industry watchers believe Google Pay and PhonePe will ramp up their marketing efforts if their market dominance comes under threat.PhonePe is already focusing on building a larger financial services play beyond payments, with offerings across insurance, credit and ecommerce.For now, the door is open. But whether the newcomers can sustain their momentum--and high burn rates--in an intensely competitive market remains to be seen.
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