Zeta launches new stack for banks to power credit transactions on UPI

Fintech startup Zeta has unveiled a new stack to support credit line-based transactions on the Unified Payments Interface (UPI), aiming to revolutionize credit distribution in India's rapidly growing fintech landscape.

Credit disbursals on UPI

Zeta's co-founder Bhavin Turakhia envisions credit disbursals on UPI reaching a trillion dollars by 2030, and Zeta intends to capture 50% of this market opportunity.

"The growth of UPI has shown that all forms of credit, be it consumer loans, personal loans, EMI loans, everything will eventually come on UPI. We want to enable all such transactions," said Turakhia.

Credit-as-a-service offering

Backed by SoftBank, Sodexo, and Mastercard, Zeta will operate as a technology service provider (TSP) for banks through its new digital credit-as-a-service platform. This solution enables banks to launch various credit products, including consumer loans and personal loans, efficiently.

Zeta's stack will help banks focus on customer acquisition and underwriting while the fintech handles customer origination, lifecycle management, analytics, and experience management.

"The customer journey and association with the bank can be fully managed on the system," explained Ramki Gaddipati, Zeta's co-founder and CTO.

Solving credit gaps

More than 160 million Indians remain underserved by traditional credit channels. Zeta's new stack leverages the National Payments Corporation of India's Credit Line on UPI scheme, providing on-demand access to credit through any PSP payment app. This digital-native experience allows consumers to borrow precisely how much they need, when they need it.  

Gaddipati emphasized the need for banking systems to prepare for the "hockey-stick growth" in credit line transactions on UPI.

"We saw UPI volumes put a strain on core banking systems. We anticipate similar volumes on Credit Line on UPI before long, and this calls for population-scale banking infrastructure," he noted.

A fully-integrated solution

Zeta's Digital Credit-as-a-Service offering includes product blueprints for loans (EMI, merchant, agricultural), out-of-the-box compliance, regulatory reporting capabilities, and process consulting support. This comprehensive solution coexists seamlessly with a bank's existing systems, minimizing disruption.

 "This is an opportunity to change the credit inclusion landscape in India. Credit Line on UPI completely changes the discovery, access, and cost mechanics of retail lending," stated Gaddipati.

Building a next-gen banking platform

Zeta has invested over $360 million in building a next-gen banking platform. It aims to disrupt global banking technology by replacing legacy systems with modern, scalable infrastructure. Zeta already powers millions of payment cards from some of the world's largest card issuers across six countries.