PhonePe recorded a 6% decline in its transaction volume to 928.3 Cr in February from 991.3 Cr transactions recorded in the previous month
Paytm processed 159.9 Cr transactions worth ₹1.74 Lakh Cr in January, down from last month’s 165.9 Cr transactions worth ₹1.81 Lakh Cr
Notably, the transaction volume for each of the players declined on a monthly basis in February due to overall transaction dip
While overall UPI transactions declined month-on-month in February, market leaders continued to retain their dominant market share.
User favourite PhonePe, which has long held the top spot in the UPI ecosystem, continued to lead despite recording an over 6% decline in its transaction volume to 928.3 Cr in February from 991.3 Cr transactions recorded in the previous month. Its transaction value for the month stood at ₹13.1 Lakh Cr.
The company recorded a market share of 46.5% in the month under review, down slightly from 46.6% in January.
Google Pay maintained its second position in the UPI market in terms of transaction volume and value. It recorded 676.7 Cr transactions in the month of February, from 722.9 Cr transactions recorded in January, processing transactions worth ₹9.03 Lakh Cr. While its transaction volume declined, market share remained the same at 34%.
The third-largest player, Paytm, saw a slight uptick in its market share at 8%. Paytm processed 159.9 Cr transactions worth ₹1.74 Lakh Cr in January, down from last month’s 165.9 Cr transactions worth ₹1.81 Lakh Cr.
Notably, the transaction volume for each of the players declined on a monthly basis in February due to overall transaction dip. As per the data by NPCI, the UPI transactions declined 6% to 20.39 Bn from 21.70 Bn in January.
The value of the UPI transactions in February stood at ₹26.84 Lakh Cr, down 5% from ₹28.33 Lakh Cr in January.
Navi retained the fourth position on the January UPI leaderboard with 65 Cr transactions worth ₹36,563 Cr, while super.money also maintained its market share, recording 28.9 Cr transactions during the month, slightly up from 28.7 Cr transactions in December.
NPCI’s Bharat Interface for Money (BHIM), which surpassed Kunal Shah-led CRED as well as FamApp last month, recorded 17.5 Cr transactions in the month under review, from 17.2 Cr transactions recorded in the previous month. Its market share also increased to 0.9% in February from 0.8% in January.
FamApp saw a marginal decline in its market share with its transaction volume declined to 14.9 Cr in February from 16.1 Cr transactions recorded in January. Meanwhile, CRED retained its market share with 14.5 Cr transactions recorded.
Although the broader UPI ecosystem is seeing a decline, the space is heating up with new activity. To ensure financial sustainability of the UPI ecosystem, a parliamentary panel recommended the re-introduction of MDR (Merchant Discount Rate) discussions as the current zero-MDR regime puts pressure on government finances as well as limiting the ability of the ecosystem to invest in long-term infrastructure.
For context, MDR is a fee paid by merchants to banks and payment service providers for processing digital transactions. The Central Board of Direct Taxes (CBDT) removed the MDR on Person-to-Merchant (P2M) UPI transactions via a gazette notification in 2020.
Important to mention that industry bodies like the Payments Council of India (PCI) have been pushing the government to restore MDR on UPI payments so that companies involved in the ecosystem can generate direct revenue instead of depending on government subsidies.
At present, the government subsidises ecosystem players enabling UPI transactions. In the Union Budget 2026–27, the Centre earmarked ₹2,000 Cr under an incentive scheme to encourage transactions made via RuPay debit cards and low-value payments of up to ₹2,000 through BHIM-UPI.
The allocation is nearly five times higher than the ₹437 Cr budgeted for FY26, though it is slightly lower than the revised estimate of ₹2,196 Cr for the year.
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