Groceries to gold: How UPI's micro-payments reshaped India's spending habits
An average Indian used UPI to make payments worth around ₹580 per day in November, and this has grown over 40% in the last two years. The growth has come on the back of the rising popularity of small-value payments for groceries and eating out, a detailed Mint analysis reveals.
It’s been nearly 10 years since the Unified Payments Interface (UPI) arrived in the Indian market and revolutionized how Indians make everyday payments.
More than 636 million UPI payments worth nearly ₹82,000 crore were made on an average day in November.
The number of transactions has been rising every month. The past five years have seen average daily transactions grow six times in value and eight times in volume.
This makes UPI the most widely used payment channel, clocking 20 billion transactions in two months this year. No other major payment method comes even halfway.
In terms of value, it’s second only to the National Electronic Funds Transfer (NEFT). However, while NEFT payments have doubled since the start of the pandemic, UPI has soared 12 times, marking the biggest jump among major categories, outpacing credit and debit cards as well.
This comes on the back of UPI’s ever-rising popularity for small-value payments, which is why it lags NEFT on total payment value. An average UPI payment is now worth just around ₹1,300, down by more than half since UPI’s initial years, and it is in a continuous decline.
If we look at an average Indian's monthly spends using UPI, the figure is rising: the amount comes to around ₹17,400 (November 2025), or ₹580 per day, up by 14% year-on-year.
These are findings of a Mint analysis of data from the National Payments Corp. of India. The data lists monthly UPI payments made to various kinds of businesses, and in all Indian states. Data for business categories was given based on official four-digit “merchant codes", but some codes for similar kinds of businesses have been clubbed for simplicity.
Shopping and eating out
The biggest merchant categories by volume are those that sell items of everyday consumption. The category “groceries and supermarkets" consistently ranks on top, while another, “department stores", also often features among the top 10. Since these categories often account for small payments, they don’t have a major share in total value.
Consider this for a hint of rising popularity: for every 100 Indians, as many as 205 UPI transactions were made at groceries, supermarkets and department stores in 2025 so far, the analysis shows. This has risen 34% in a year, and is 6.4 times what it was in 2022.
The average transaction value for these stores stands at ₹233, half of what it was in 2022. This means people are making more frequent, smaller-value payments than before. Other daily-life categories, such as pharmacies, have seen similar trends.
UPI is also becoming the preferred mode of transaction while eating out; this could also be evidence of the rising popularity of eating out by itself.
The average UPI transaction size for two such categories—“eating places and restaurants" and “fast food restaurants"—was ₹140 in 2025, the lowest among the biggest segments.
Usage levels have risen dramatically: three years ago, there were only 24 UPI-based food-related payments per 100 Indians per month, which soared to 161 in 2025. No other category saw such growth.
The surge in financial spending
UPI spending in categories related to financial institutions also showed a clear upward trend, indicating rising affinity towards both debt and investment. Two such categories—"debt collection agencies" and “securities brokers and dealers"—topped the charts in terms of total UPI expenditure, though their volumes are lower.
An average person spent nearly ₹543 via UPI on debt collection agencies in 2025, the highest among all merchant categories. As many as 10 payments are now being made per 100 Indians under this category. Debt collection agencies refer to entities that help lenders recover unpaid dues.
Securities brokers and dealers—businesses involved in buying, selling, and brokering securities like stocks and bonds—also recorded a sharp rise, and UPI-based digital gold purchases have featured among the top 30 segments in all months this year, with an average purchase being worth just ₹138, and nearly six monthly payments being made for every 100 Indians.
Cashless economy? Not yet.
UPI’s adoption varies widely across India. Interestingly, people in India’s 10 poorest states also spend the least amount of money using UPI on a per capita basis. Take Bihar, Uttar Pradesh and Jharkhand, for example: the three states with the lowest per capita income also feature at the bottom on per capita UPI spending ( ₹5,000-5,800) this year, against the national average of over ₹17,400.
Residents of Telangana, Goa and Delhi pay the most through UPI—upwards of ₹25,000 per month. Gujarat is a rare example of a high-income state where UPI spending remains less common than the rest of India.
Assam and Maharashtra showed the highest affinity for low-value transactions, with the average UPI payment being worth less than ₹1,200, while this exceeded ₹1,600 for Andhra Pradesh and Punjab. However, state-level data could be faulty, since it is available only for around 62% of payments this year; the rest were listed as “unclassified".
The growth of UPI, which completes a decade in April, makes itself felt through the now-ubiquitous QR codes, but at the heart of it is a cocktail of technological as well as policy factors, ranging from cheap data and smartphones to the absence of transaction charges.
As India moves ahead in its journey towards greater formalization of the economy and a cashless future, the next phase of UPI’s growth will come from increased awareness and efforts towards adoption in states that are falling behind.
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