Do you remember these? Of course, you would remember. But do you remember the last time you used it? Most of you won’t!
UPI, the culprit, has not just entered the Indian market but has demonstrated itself as a force of creative destruction. Its status as creative destruction signifies its transformative power, as it has not only entered the market but also displaced older payment methods, reshaping the Indian payment landscape.
UPI’s advent and remarkable growth in India have changed how we used to live and made our lives easier. The days of carrying cash, credit, and debit cards have almost vanished from our daily lives. For instance, paying for groceries, transportation, utility bills, membership, etc., is done seamlessly with a single click through UPI. Moreover, even the most minor vendors, such as vegetable and fruit
vendors and auto-rickshaw drivers accept the UPI payment.
All of this started with the boom of the internet, which laid the foundation of the digital age. Post which smartphones, which were becoming more affordable and accessible, brought the internet into the hands of the people, and the internet paved the way for online transactions. After all, today, the country is home to the second-largest smartphone user base in the world. This second-largest user
base only accounts for approximately 30% penetration, and more than 70% of the population in the country has not yet been exposed to the benefits of the digital revolution that we have seen.
Despite different UPI payment applications, this market has become oligopolistic, with most of the market share with PhonePe and Google Pay. Despite this, Phonepe has established its most significant market share dominance. It would be interesting to see if there will be any shake-up in the payment aggregator space to avoid a monopoly within this sector.