India’s Unified Payments Interface (UPI) ecosystem is undergoing a quiet but significant shift. For years, PhonePe and Google Pay dominated the market almost entirely. Now, their combined market share has slipped by over four percentage points in the past year, even as overall UPI usage has grown to record highs. The reason? New players like Navi and Flipkart-backed super.money are making serious inroads.
Declining Market Share for the Big Two
PhonePe’s market share fell by around 2.6 percentage points, while Google Pay dropped about 1.5 percentage points. Together with Paytm, their collective share of the UPI market has come down from over 95 percent in early 2024 to roughly 88 percent by mid-2025. But make no mistake — PhonePe still processes close to half of all UPI transactions, with Google Pay handling around 35 percent. The duopoly is still strong, but it is no longer absolute.
New Players Are Gaining Traction
The newcomers are reshaping how users experience digital payments. Super.money has skyrocketed from a small base of 2.5 million monthly transactions to 250 million within a year, fueled largely by younger Gen Z users. Navi, launched by Sachin Bansal, is leveraging smart marketing and a trusted brand legacy to attract a growing share of UPI users. Together, these apps are chipping away at the old guard’s lead by offering cashback, loyalty points, and bundled financial services that keep customers engaged.
UPI Usage Continues to Boom
At the same time, UPI itself continues to boom. In August 2025 alone, India processed more than 20 billion UPI transactions worth nearly ₹25 lakh crore — a record high. The shift in market share isn’t about declining usage, but about new competitors carving out their own niches within an expanding digital payment space.
Regulators Push for a Balanced Ecosystem
Regulators are watching closely. The National Payments Corporation of India (NPCI) has long aimed to prevent any single player from controlling too much of the UPI network. A proposed cap of 30 percent market share for individual apps has been delayed until the end of 2026, giving PhonePe and Google Pay more time to adjust. Meanwhile, NPCI has granted TPAP (Third-Party Application Provider) approvals to over 20 new apps, further diversifying the ecosystem.
Healthy Competition Fuels Innovation
Industry analysts view this as a sign of healthy competition. The arrival of multiple strong players is expected to increase innovation, improve user experience, and reduce systemic risk in India’s most widely used digital payment network. While the big names remain powerful, they’re now being forced to adapt faster — whether through partnerships, loyalty programs, or new integrated financial services.
The Road Ahead for UPI Players
Looking ahead, the real story may be about consolidation through value-added services. Apps that combine payments with lending, investing, or shopping could find it easier to retain customers. At the same time, if the NPCI cap is eventually enforced, it could dramatically redistribute volumes among smaller players. That makes the next 18 months crucial for strategy, scale, and customer loyalty across India’s fintech landscape.