India’s share of digital payments has increased over time, with the Unified Payment Interface (UPI) growing to over 750 million day by day transactions. Aiming to achieve over a billion day by day transactions, Dilip Asbe, MD and CEO of National Payments Corporation of India, which oversees UPI, believes AI will play a vital role in the following phase for user growth, fraud prevention and credit distribution.
During an interview with TechCrunch at Mumbai Tech Week (MTW) 2026 last month, Asbe said AI could power the following half a billion users if NPCI, India’s central bank, and the federal government work together.
“AI will be used very effectively as we look at the next wave of UPI and that covers all aspects including reaching new users. We need to use AI effectively to protect our current citizens, detect fraud and ferret out mules. AI also needs to be used to provide credit to all users and merchants who have digital footprints,” he said. “We need to use AI to look at voice and multilingual solutions to make onboarding easier.”
Many firms have talked about how voice is essential as an interface in India to talk with firms or systems. Asbe believes this continues to be early days as language models must be more accurate. NPCI has been began a voice assistant based interactive system in 2023. Asbe noted that adoption for this continues to be pending and that with the fitting use case, voice can turn into a vital component within the payments ecosystem.
AI in finance and regulations
In the US, startups and publicly traded firms are vying to introduce AI into the financial industry. Coinbase and Robinhood now allow agents to trade on behalf of users, and OpenAI permits you to load personal account details into ChatGPT to receive financial advice. NPCI showed some demos around agent commerce and payments with Razorpay last 12 months. However, a few of these features haven’t been rolled out more widely.
The CEO of NPCI believes that with strong regulations and a framework, India may also adopt AI-powered finance. He said there needs to be sufficient user protection and risk mitigation – and within the event something goes improper, the system should have the option to ascertain the instructions and consent the user has given an agent.
Asbe believes that along with using models, the Indian financial ecosystem also has the chance to create small language models.
“We believe the models will differ from each other based on the data sets that are provided to them,” he said. “We have a very rich data set in our ecosystem. I think there is a huge opportunity for Indian companies – the banks, FinTechs and the ecosystem – to build small language models that are sharp, specific and as deterministic as possible.”
Last 12 months, NPCI developed a model called “ FIMI to resolve user disputes. Asbe noted that the corporate supports over 1,000,000 users in canceling mandates and resolving issues and is scaling quickly.
UPI competition
NPCI has long sought healthy competition amongst UPI apps, but data suggests that Walmart-owned PhonePe and Google Pay have over 80% of the market share. The regulator’s plan to limit an app’s market share to 30% is about to return into effect on December 31, 2026, unless it postpones the deadline again.
During the conversation, Asbe said that UPI apps have very low switching costs and many of the core features are shared. He noted that PhonePe and Google have poured hundreds of thousands into their apps to realize their market position. He said as latest apps find viable business models within the fintech ecosystem, their share will increase.
“I believe there are several reasons why we see this concentration risk and one of the important reasons is the availability of a viable business model. Once we see the business model available to the ecosystem, I believe newer players will start investing very heavily,” Asbe said.
The payment office was spun off in 2024 BHIM UPI app to make it more competitive and increase its usage. Although the transaction volume has increased, the general market share is around 1%. Asbe said there isn’t a specific goal market share at BHIM that NPCI has in mind. But it desires to make it a confident and secure alternative to other apps, Asbe said.
India is certainly one of the biggest digital economies and investors around the globe can be the regulatory landscape to place money into newer fintech solutions and make the market more competitive.
