Podcast Overview

The episode of People by WTF hosted by Nikhil Kamath brings together senior executives from the National Payments Corporation of India (NPCI), Razorpay and PhonePe to dissect the architecture, economics and future of India’s Unified Payments Interface (UPI).

Key Participants

  • Sohini Rajola, Executive Director – Growth at NPCI, the not‑for‑profit body set up by the RBI and the Indian Banks’ Association with an initial Rs 100 crore capital from ten banks.
  • Harshil Mathur, Co‑founder and CEO of Razorpay, which he launched with Shashank Kumar to serve businesses across payments, cross‑border collections, connected banking, payroll and vendor payments.
  • Sameer Nigam, Founder and CEO of PhonePe, co‑founded with Rahul Chari after leading checkout and payments at Flipkart during its first Big Billion Day.
  • Additional guests include Prachi Dharani and Yogesh Lokhande of PayGlocal, Ayush Agarwal of Dodo Payments, and Vijay Khubchandani of Seven.

UPI Ecosystem Details

UPI now processes close to one billion transactions per day. Each transfer involves roughly ten API calls, real‑time fraud checks and settlements that NPCI runs ten times daily across participating banks. Tier‑2 towns and smaller cities generate 65‑70% of digital money movement, much of it peer‑to‑peer between villages, while online shopping remains concentrated among a relatively small user base.

Market Share and Regulation

PhonePe and Google Pay together command about 80% of UPI transaction volume. NPCI enforces a 30% volume cap on third‑party UPI apps to preserve a competitive ecosystem. The discussion highlighted the tension between allowing dominant apps to grow versus maintaining consumer choice and system health. Kamath referenced his own experience with a regulatory cap at Zerodha, noting that client migration to smaller brokers can ultimately benefit the market.

GST Impact on Spending

PhonePe data shows a clear correlation between GST reductions and consumer spend:

  • When GST fell by 2%, overall spending rose 5.5‑6%.
  • A 5% GST cut triggered a 13% jump in spending.
  • When GST rates remained unchanged, spending showed minimal movement.

These figures illustrate the price‑elastic response of Indian consumers to tax adjustments.

Future Technologies and Opportunities

The panel debated AI‑driven payment agents. Nigam expressed skepticism about current economics, while Mathur argued that falling model costs and the need for vernacular‑language agents present a uniquely Indian opportunity. NPCI is exploring how agent‑led payments can operate on UPI while remaining interoperable across apps.

Cross‑Border Payments Initiatives

PayGlocal’s co‑founders described the challenges of cross‑border card payments, where differing bank interpretations cause failures. Their platform enables Indian merchants, exporters and freelancers to receive foreign payments and lets global merchants accept UPI and local Indian methods. Dodo Payments, a merchant‑of‑record solution, allows a developer in Indore to sell a USD 20 subscription to a customer in Berlin without building an international payments stack; the company notes that almost all of its code is now written by AI.

Wearables and NFC Outlook

Seven’s founder, Vijay Khubchandani, launched the 7 Ring, India’s first NFC payment ring built in collaboration with RuPay. He projects NFC touchpoints to expand from roughly 1 crore today to 4‑5 crore in the near future, making payments increasingly “invisible”.

Opportunities for Founders

The conversation identified several underserved niches: B2B tools for small retailers juggling 70‑80 distributors and manually reconciling invoices, GST and TDS; simpler UPI‑based tipping mechanisms; escrow‑style payments for first‑time online shoppers; cross‑border payments for medical travellers; and formal credit products for users whose payment histories now exist.

Compliance and Trust

Both Dharani and Lokhande emphasized that compliance cannot be an afterthought; founders should view regulation as a spirit to uphold consumer protection and trust. The episode concludes with a call to build infrastructure rather than another payments app.

The full episode is available on YouTube.