MUMBAI: India’s digital merchant payments market grew 19.6% year-on-year to Rs 11.7 lakh crore in July, but the more consequential change was in how that money moved: UPI’s share of person-to-merchant transactions reached a record 77.3%, while credit and debit cards continued to lose ground.According to a report on digital payments by Equirus, UPI’s share of M transactions rose 243 basis points year-on-year from 74.9% in July 2025 and increased 22 basis points from June 2026. UPI is increasingly becoming the default payment rail for both retail purchases and merchant transactions, helped by its ubiquity and ease of use.Credit cards, by contrast, are growing more slowly than the market they once benefited from. Their share of merchant payments fell to 17.7% in July 2026 from 19.8% a year earlier, a decline of 203 basis points and below their trailing 12-month average of about 19%.Debit cards fared worse: their share declined to 3.2% from 3.9% reflecting the continued migration of direct bank-account spending to UPI.
