Indian payments chief thinks AI will be heavily involved in next era of digital payment growth

The digital payment landscape in India has witnessed remarkable growth in recent years, with the Unified Payment Interface (UPI) now handling over 750 million transactions daily. Dilip Asbe, Managing Director and CEO of the National Payments Corporation of India (NPCI), which manages UPI, envisions a future where artificial intelligence (AI) plays a crucial role in propelling this growth to over a billion daily transactions. During a recent interview at Mumbai Tech Week (MTW) 2026, Asbe highlighted that AI will be instrumental in attracting the next wave of users, enhancing fraud detection, and facilitating credit distribution. He emphasized the need for collaboration between NPCI, India’s central bank, and the government to harness AI’s full potential. "AI will be utilized effectively to expand our user base, safeguard existing users, identify fraudulent activities, and extend credit to both users and merchants with digital footprints," he stated. Asbe also pointed out the significance of voice and multilingual solutions in simplifying user onboarding. Many companies are exploring voice interfaces for interactions with their systems, but Asbe believes that these models need further refinement. In 2023, NPCI rolled out a voice assistant-based interactive system, although its adoption has yet to gain traction. With the right use cases, voice technology could become a vital component of the payment ecosystem. In contrast to India, companies in the U.S. are swiftly integrating AI into financial services. Major players like Coinbase and Robinhood now offer AI-driven trading on behalf of users, while OpenAI enables the integration of personal financial data into ChatGPT for tailored advice. NPCI has demonstrated potential applications of AI in commerce and payments, particularly in collaboration with Razorpay; however, widespread implementation is still pending. Asbe advocates for a robust regulatory framework to support the safe adoption of AI in finance, ensuring user protection and risk mitigation. He noted that in the event of an issue, systems should have the capability to reference the user’s instructions and consent. Furthermore, he sees a significant opportunity for the Indian financial ecosystem to develop small language models tailored to local datasets. "We believe these models will stand out based on the quality of data available to them," Asbe remarked. The NPCI previously launched a model named FIMI to address user disputes, which is currently assisting over a million users in resolving issues and is rapidly scaling. Despite NPCI's efforts to foster competition among UPI applications, market dominance remains concentrated, with PhonePe and Google Pay commanding over 80% of the market share. The regulator plans to limit an app's market share to 30%, set to take effect on December 31, 2026, unless the deadline is postponed. Asbe noted that low switching costs and shared core features among apps contribute to this concentration. He believes that as viable business models emerge within the fintech ecosystem, new entrants will invest heavily to capture market share. In 2024, NPCI spun off its BHIM UPI app to bolster its competitiveness, which has seen transaction volumes rise, though its market share remains around 1%. Asbe clarified that NPCI is not targeting a specific market share for BHIM but aims to establish it as a secure alternative to existing apps. As India solidifies its position as a leading digital economy, global investors will closely monitor the regulatory environment to identify opportunities for innovative fintech solutions and enhance market competitiveness.