UPI developer NPCI's profit jumps 42% to Rs 1,552 crore in FY25

UPI developer the National Payments Corporation of India (NPCI) has reported a 41.7% rise in revenue surplus to Rs 1,552 crore for the fiscal year ending March 2025.

Although NPCI is a not-for-profit organization and does not declare profits in the traditional sense, its surplus after tax — analogous to net profit in private corporations — rose sharply from Rs 1,095 crore in FY24, according to a report by rating agency ICRA.

The operator’s standalone revenue grew 19% year-on-year to Rs 3,270 crore, up from Rs 2,749 crore in FY24. This increase was attributed to surging digital transaction volumes across platforms such as UPI, Immediate Payment Service (IMPS), Aadhaar-enabled Payment System (AePS), Bharat Bill Payment System (BBPS), and the National Common Mobility Card (NCMC). These platforms generate revenue through fees charged on the value of transactions processed by partner banks and fintech firms.

NPCI processed a staggering 21,360 crore transactions in FY25, up 33% from the 16,100 crore transactions recorded the previous year. As of March 31, its net worth rose to Rs 6,412 crore, while its Settlement Guarantee Fund (SGF) reached Rs 17,892 crore, reflecting a robust financial buffer to support rising payment volumes. Of the total SGF, Rs 2,695 crore was earmarked for BBPS.

Despite its financial strength, NPCI faces operational headwinds. UPI, the crown jewel of India’s real-time payments architecture, experienced multiple service disruptions in recent months. A major outage on April 12 was attributed to an overload of API requests, particularly excessive use of the 'Check Transaction' API by some partner banks, which affected platforms such as Google Pay, PhonePe, and Paytm.

In May alone, UPI processed 18.6 billion transactions, amounting to Rs 25.14 lakh crore in value, reflecting continued mass adoption. However, the Finance Ministry recently reiterated that UPI transactions would remain free for merchants, dousing speculation around the reintroduction of merchant discount rates (MDR), a fee that digital payment firms have lobbied for to address monetization issues.

To help sustain the UPI ecosystem, the Union Cabinet earlier approved a Rs 1,500 crore incentive scheme aimed at reimbursing banks and fintechs for small-ticket digital payments. Yet, several payment firms argue that the fund falls short given the scale of India’s digital payment infrastructure.

Established in 2008 by the Reserve Bank of India and the Indian Banks’ Association, NPCI has evolved into a key digital public infrastructure provider. Its flagship UPI platform, which was launched in 2016, benefitted immensely from the 2016 demonetization drive, smartphone adoption, and the rapid entrance of private players into the payments ecosystem. As of May 2025, NPCI had 65 shareholders, including public, private, and foreign banks.