India’s share of digital payments has been growing over the years, with Unified Payments Interface (UPI) growing to over 750 million transactions per day. Dilip Asbe, MD and CEO of National Payments Corporation of India, which oversees UPI, believes AI will be heavily involved in the next steps for user growth, fraud prevention and credit distribution as the company aims to achieve more than 1 billion daily transactions.
In an interview with TechCrunch at the Mumbai Technology Week (MTW) 2026 last month, Asbe said AI could drive the next 500 million users with NPCI, Reserve Bank of India and the government working together.
“AI will be used very effectively as we look at the next generation of UPI and this includes all aspects including reaching out to new users. We need to use AI effectively now to protect citizens, spot fraud and find mules. AI should also be used to provide credit to all users and merchants with a digital footprint,” he said. “We need to use AI to look at voice and multilingual solutions to further simplify onboarding.”
Many companies have been talking about voice as an important interface for chatting with companies or systems in India. Asbe believes it is still early days, as speech models need to become more accurate. NPCI launched a voice assistant-based conversational system in 2023. Asbe noted that adoption has not yet occurred, and with the right use cases, voice could become an important component in the payments ecosystem.
AI in Finance and Regulation
In the United States, startups and public companies are competing to incorporate AI into finance. Coinbase and Robinhood now allow agents to trade on your behalf, and OpenAI lets you load your personal account data into ChatGPT to get financial advice. NPCI presented several demos of proxy commerce and payments with Razorpay last year. However, some of these features have not been rolled out more broadly.
NPCI’s CEO believes that with strong regulations and frameworks, India can also adopt AI-based finance. He said there should be sufficient protection and risk mitigation for users, and if something goes wrong, the system should be able to see the instructions and consent users have given to agents.
Beyond model usage, Asbe believes there is an opportunity to build small-scale language models in the Indian financial ecosystem.
“We believe that the models will differentiate themselves from each other based on the available data sets,” he said. “There are very rich data sets in our ecosystem. I think there is a huge opportunity for Indian businesses, be they banks, fintechs or ecosystems, to create small language models that are as clear, specific and decisive as possible.”
Last year, NPCI launched a model called FIMI to resolve user disputes. Asbe canceled the order and addressed the issue, noting that it serves more than a million users and is scaling rapidly.
UPI competition
NPCI has long sought healthy competition among UPI apps, but data shows that Walmart-owned PhonePe and Google Pay hold over 80% of the market share. The regulator’s plan to limit apps’ market share to 30% is due to come into effect from December 31, 2026, unless the deadline is pushed back again.
During the conversation, Asbe said that the switching cost of UPI apps is very low and most of the core features are shared. He noted that PhonePe and Google have poured millions of dollars into apps to secure their market position. He said new apps will gain share as they find viable business models within the fintech ecosystem.
“I think there are a number of issues where I see this concentration risk existing, and one of the important reasons is the availability of a viable commercial model. I believe that the moment they see a commercial model available in the ecosystem, new players will start investing very heavily,” Asbe said.
In 2024, the payment institution will spin off the BHIM UPI app to become more competitive and increase usage. Although trading volume has increased, the overall market share is around 1%. Asbe said there is no particular target market share NPCI is eyeing regarding BHIM. But Asbe said it wants to make it a sovereign and secure alternative to other apps.
India is one of the largest digital economies, and investors from around the world will be investing money in new fintech solutions and looking at the regulatory environment to make the market more competitive.
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