India’s Digital Public Infrastructure, also called the “India Stack,” are open-source foundational digital systems that enable population-scale, secure, and inclusive access to services. These include Aadhaar, UPI, BBPS, e-RUPI, Fastag, and Digi Locker. PhonePe’s core offering - UPI - is built on India’s DPI model, which has revolutionized the payments landscape for millions of Indians and driven digital payment adoption across 99% pincodes of the country.
Built on the Bedrock of UPI
PhonePe is the first TPAP to adopt UPI and is one of the earliest adopters of other DPI initiatives at scale, including Bharat Connect (formerly BBPS), Aadhaar, DigiLocker, and more recently Rupay. Their platforms are built on and for India’s DPI, solving everyday needs such as money transfers, KYC services, bill payments, offline payments at stores, and online payments on apps or websites, bringing Indians from tier 2, 3, 4 cities and beyond into the digital fold.
1. Unified Payments Interface (UPI): When the PhonePe app was launched in 2016, the primary feature was UPI-based payments which allowed users to pay other users or merchants. The transactions were carried out on top of a system that powers multiple bank accounts into a single app (of any participating bank), merging several banking features, seamless fund routing, and merchant payments into one hood. This enables immediate money transfer through mobile devices round the clock, 365 days a year.
Additional UPI offerings on the PhonePe app include:
UPI Autopay: The AutoPay functionality supports recurring payments, allowing users to set up recurring mandates for payments such as mobile bills, electricity bills, EMI payments, entertainment/over-the-top subscriptions, insurance, mutual funds, etc.
UPI Lite: This payment solution is designed to process low value transactions below ₹1,000 without the need for a PIN. UPI Lite experience is intended to be a user-friendly approach reducing load on core banking systems in real-time.
UPI Circle: This is a solution where a user can extend the authorisation to transact from their UPI account to an individual, within set limits. It enables a secondary user, such as a senior citizen parent or an unbanked young adult, to carry out transactions from the payer’s account with minimum intervention and with adequate risk mitigations.
Wallet on UPI: The PhonePe Wallet is integrated with UPI, making it fully interoperable on UPI rails. This enables users to pay using their wallet balance at any UPI QR or transfer money to any UPI handle, thereby enhancing versatility and ease of use.
Bharat Connect: Bharat Connect is an interoperable platform that streamlines recurring bill payments. The PhonePe app houses various Bharat Connect offerings such as Mobile & Broadband Recharges, Insurance Premiums, Loan Repayments, Credit Card Payments, Cable TV and DTH fees, Electricity payments, Piped Gas fees, Water consumption charges, Municipal Taxes, Housing Society Maintenance, FASTag Recharge, School/College Fees, Donations and so on.
eKYC: e-KYC enables instant, paperless identity verification through Aadhaar, streamlining the onboarding and verification process required for accessing financial services. On PhonePe, it is a core component to onboard users to financial products like lending, insurance and its stock broking platform, Share.Market. It is also used to verify the identity of merchants to onboard them onto payment acceptance and merchant lending.
RuPay Credit Cards on UPI: The RuPay Credit Card network, an Indian alternative to Visa and Mastercard, can be linked to a UPI ID, thus enabling seamless credit transactions. PhonePe recently announced Rupay Credit cards in association with HDFC and SBI. These offer users an increased opportunity to utilise credit cards. Merchants, on the other hand, benefit from increased consumption by participating in the credit ecosystem with acceptance of credit cards via asset-lite QR codes.
Impact of PhonePe’s Scale through DPI Initiatives
PhonePe’s business scale is a testament to the power of DPI. By leveraging open-source systems, PhonePe has achieved a presence in 99% of India's pincodes. This reach is evidenced by their performance metrics as of September 30, 2025, according to their recently filed DRHP:
User Base: 657.56 million Life-till-Date Registered Users
Merchant Network: 47.19 million Life-till-Date Registered Merchants
Transaction Velocity: In Fiscal Year 2025 alone, the platform processed 90.27 billion annual Consumer Transactions and 42.66 billion Merchant Transactions.
According to Sensor Tower data, PhonePe remains India’s most downloaded Android finance app, recording 156 million Daily Active Users in H1 Fiscal Year 2026.
PhonePe’s leadership in the payments sector and its aggressive diversification into insurtech, wealthtech, and beyond serves as a definitive case study for the commercial triumph of India’s DPI. By layering private innovation atop public digital goods, PhonePe has validated the public-private partnership - powered by the India Stack model - as an efficient, population-scale foundation that provides a sustainable roadmap for the entire industry. This success has created a robust launchpad for PhonePe to explore newer, high-potential fintech avenues, signaling its massive future potential as a diversified financial powerhouse.