The average daily value of transactions conducted through the Unified Payments Interface (UPI) surpassed ₹1 trillion for the first time in October 2026. This milestone aligns with the onset of the festive season in India, which traditionally sees a surge in consumer spending. The month recorded an impressive average daily volume of 822 million transactions, marking the highest figure to date for UPI.

In total, October witnessed 25.47 billion transactions, reflecting an increase of approximately 23 per cent compared to the 20.7 billion transactions recorded in October 2025. The total value of transactions processed during the month reached ₹31.53 trillion, which is 16 per cent higher than the ₹27.27 trillion processed in the same month the previous year.

This substantial growth in transaction volume and value is attributed to the festive activities, including Navratri celebrations and significant online sales events that occurred throughout October. Consumers increasingly relied on UPI for both substantial festive purchases and everyday payments, contributing to the overall rise in transaction values.

Trends in UPI Transactions Over Recent Months

Data from previous months indicates a steady increase in UPI transactions. In September 2026, there were 24.06 billion transactions amounting to ₹29.37 trillion, while August saw 24.5 billion transactions worth ₹29.82 trillion. Notably, although the number of UPI payments had been on the rise from April to August, the average daily transaction value had remained relatively flat during that period.

However, the trend shifted in September and October, with the value of payments increasing at a faster rate than the number of transactions. This shift resulted in a consecutive rise in the average transaction size over these two months, indicating a growing consumer confidence in using UPI for larger purchases.

Industry experts have highlighted the importance of maintaining the long-term sustainability of the digital payments system, especially during peak consumption periods like the festive season. The proposed introduction of a merchant discount rate (MDR) on select person-to-merchant (P2M) transactions has raised concerns about affordability for both consumers and merchants.

Concerns Over Merchant Discount Rate Implementation

The proposed MDR framework was initially set to be implemented on October 15, but reports suggest that its introduction has been deferred until after Diwali. This delay has sparked discussions regarding the long-term viability of India’s digital payments infrastructure. With transaction volumes expected to rise during festive periods, it is crucial to ensure that digital payments remain accessible and affordable.

Akshay Mehrotra, managing director and group chief executive officer of Fibe, emphasised the need for a balanced approach. He stated that while the ecosystem must remain commercially sustainable, it is equally important to keep digital payments affordable for consumers and merchants alike. The ongoing discussions around the MDR framework will likely influence the future landscape of digital payments in India.

As the festive season progresses, stakeholders in the digital payments sector will be closely monitoring transaction patterns and consumer behaviour. The recent surge in UPI usage underscores the platform’s growing significance in facilitating financial transactions across the country, paving the way for further innovations and developments in the digital payment space.

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