Learning who’s left out of the UPI ecosystem
The next step for UPI is not just about larger transaction numbers but also about broader participation
As India’s payments digital public infrastructure approaches its tenth anniversary, the Unified Payments Interface (UPI) continues to stand out for its scale and adoption. In November alone, it processed over 20 billion transactions. As estimated by experts, UPI has 491 million unique users and serves close to half of India’s total addressable population. Its role in reshaping everyday transactions is evident. Yet, important questions remain: Who are the millions still not using UPI, and why? And is there public data that can point us toward the answers?
These questions matter because the next phase of UPI’s growth depends on a deeper focus on inclusion and innovation. Reaching those who remain outside it needs a clearer picture of who the non-users are, where they are concentrated, and what prevents them from joining. However, the public data currently available does not allow for such analysis. At present, information on UPI largely covers aggregate transaction volumes, values, and technical performance indicators such as uptime. While these metrics capture system efficiency, they offer little insight into the distribution of adoption across geographies, income groups, or demographic segments. It is thus difficult to design interventions that address the specific reasons for non-use.
A national baseline study on UPI users and non-users could help bridge this gap. Such a study would allow policymakers to identify clusters of exclusion, whether these lie in rural areas with poor connectivity, among older populations less familiar with digital interfaces, or among those who lack access to smartphones or formal financial accounts. The data could also point to the underlying reasons for non-use, which may differ across groups.
Evidence from a recent study by Artha Global provides a starting point. The study covered 3,200 personal users, 800 micro-merchants, and 800 non-users across four districts in Maharashtra (high digital maturity state) and Bihar (low digital maturity state). While the findings are based on in-sample data and are not nationally representative, they highlight important trends, suggesting that non-users are not a single group but fall into distinct categories, each facing different barriers to adoption.
The first group consists of those who are unaware of UPI altogether, a surprisingly large share. About 57% of non-users surveyed had not heard of the platform. This indicates that even in states with relatively high digital maturity, awareness gaps persist. Knowing where these gaps are most pronounced can help target outreach efforts more effectively.
A second group is aware but access-constrained. These individuals face structural or capability-related barriers such as a lack of personal smartphone access, poor internet connectivity, or limited digital comfort. While nearly all respondents had bank accounts, 60% of aware non-users cited lack of smartphone access or the confidence to use one as barriers. These constraints were found to be gendered — women were less likely to have a personal device or feel comfortable using it. Understanding where such access and capability barriers are concentrated could guide investments in both digital infrastructure and literacy.
A third group can be described as access-ready but unconvinced. These individuals have the necessary prerequisites — smartphones, internet access, and bank accounts—but choose not to use UPI. Their reasons relate to perceived complexity, usability concerns, or apprehensions about safety and security. Addressing this group will require efforts focused on building trust and simplifying user experience, rather than expanding infrastructure alone.
These three categories — unaware, access-constrained, and access-ready — collectively point to a layered reality that captures the varied challenges driving non-use. Each requires a different kind of policy response: Targeted communication for the unaware, structural and capability support for the access-constrained, and confidence-building measures for the access-ready.
A national baseline study could help identify where each group is concentrated, enabling researchers, policymakers, and other stakeholders to respond with precision rather than through broad, undifferentiated measures. Such data could also support ongoing efforts to make digital payments more inclusive by providing a foundation for longitudinal tracking of adoption and usage.
As India looks to expand the reach of its digital public infrastructure, the next step for UPI is not just about larger transaction numbers, but also about broader participation. UPI’s long-term success will depend on how effectively it reaches those still excluded, and that effort must begin with a clearer understanding of who they are and why they remain outside the system. Without this baseline, policy efforts risk being guided by aggregate data that conceal, rather than reveal, the gaps that matter most.
Khushi Baldota and Anushri Pundit are with Artha Global. The views expressed are personal
