Would you pay for your next smartphone or even a luxury car using UPI? That future is closer than you think. A few years ago, UPI was primarily used to split restaurant bills and make small online purchases. Today, it is transforming into a powerful tool for high-value UPI transactions, challenging traditional payment methods like credit cards.
With EMI on UPI and UPI AutoPay, customers can now buy expensive items, pay in instalments, and automate recurring payments—all without a credit card. From premium smartphones to subscriptions, UPI is becoming the go-to payment method.
This blog explores UPI’s journey from microtransactions to big-ticket payments. We’ll also discuss its growing global presence and whether it could replace credit cards. More importantly, we’ll break down what this means for businesses and why integrating UPI could be a game-changer.
The growth of UPI: From small payments to big transactions
UPI’s evolution
The Unified Payments Interface (UPI) was launched in 2016 to simplify digital transactions. Initially, it was seen as a quick and easy method for peer-to-peer (P2P) transfers and small-value payments.
However, in just a few years, UPI has transformed into India’s most dominant payment system, processing over 16 billion transactions a month.
One of the biggest shifts in recent years is UPI’s expansion into high-value transactions. Earlier, it was common for users to make payments under ₹1,000. Today, consumers are comfortable making payments worth lakhs of rupees via UPI. This shift is due to growing trust in digital payments and the introduction of credit-linked features like EMI on UPI.
Industries like e-commerce, travel, and retail are now actively leveraging UPI for big-ticket sales. Airlines, electronics brands, and even automobile manufacturers are integrating UPI to enable seamless transactions without credit card dependency.
UPI’s global expansion
UPI’s success isn’t just limited to India. It is gaining traction globally, with countries like UAE, Singapore, France, and Sri Lanka allowing UPI-based payments. This expansion enables Indian travellers to pay for hotel bookings, dining, and shopping abroad using their UPI apps. No forex cards or cash withdrawals are needed.
This opens up huge possibilities for businesses. E-commerce sites can now offer UPI for international payments, cutting down on expensive payment gateways. With international partnerships and growing adoption, UPI is well on its way to becoming a global standard for digital payments.
EMI on UPI & UPI AutoPay: Enabling high-value transactions
What is EMI on UPI?
Credit cards have long dominated the high-value purchase segment due to their easy EMI options. However, EMI on UPI is now disrupting this space. Instead of needing a credit card, customers can now split large purchases into instalments directly from their bank accounts.
Here’s how it works:
- When making a high-value purchase like an iPhone, the customer chooses EMI on UPI at checkout.
- The bank or fintech partner instantly approves the EMI based on the customer’s creditworthiness.
- The amount is debited in monthly instalments, just like a credit card EMI.
This is especially beneficial for consumers who don’t own credit cards but still want to buy expensive items like smartphones, laptops, or home appliances.
For businesses, integrating EMI on UPI can boost conversion rates by making products more affordable without the complexity of card-based financing.
Understanding UPI AutoPay
Recurring payments have always been a challenge in India, with failed transactions due to insufficient balance or expired card details.UPI AutoPay solves this by enabling automatic deductions for subscriptions, insurance premiums, and other recurring expenses.
For businesses, this ensures seamless, uninterrupted payments. Here’s whyUPI AutoPay is gaining traction:
- Simplified subscription models: OTT platforms, gyms, and SaaS businesses use UPI AutoPay to ensure continuous service without renewal reminders.
- Financial services adoption: Insurance companies and mutual fund providers use it for policy renewals and SIP contributions.
- Higher customer retention: Businesses reduce churn as payments happen automatically without manual intervention.
By adopting UPI AutoPay, businesses can improve cash flow, reduce late payments, and offer customers a hassle-free experience. As more companies integrate these features, UPI is set to play an even bigger role in India’s digital payment ecosystem.
UPI vs. Credit Cards: Which is better for big-ticket payments?
While UPI offers low-cost, instant bank-to-bank transfers, credit cards provide credit lines and rewards. But which one truly benefits businesses and customers? Let’s compare.
1. Convenience & adoption
Ease of use is a major advantage in high-value UPI transactions.
UPI is directly linked to a user’s bank account, eliminating the need for credit approvals or separate applications. Anyone with a bank account can use UPI instantly, making it highly accessible.
Credit cards, on the other hand, offer benefits like cashback and reward points. However, they require credit checks, come with annual fees, and have interest rates that discourage many users.
With EMI on UPI, customers can now enjoy similar instalment benefits without the drawbacks of credit cards.
2. Cost comparison for businesses
For businesses, UPI payments in India are significantly more cost-effective than credit cards. UPI transactions typically have zero or lower merchant discount rates (MDRs), while credit card transactions can attract fees as high as 2% to 3% per transaction.
For instance, when boAt, a leading D2C electronics brand, expanded its UPI payment options, it reduced transaction fees and improved margins, making its online store more competitive.
3. Security & fraud protection
Security is a priority for both payment methods, but they operate differently. UPI relies on two-factor authentication (2FA) via a mobile PIN, reducing fraud risks. However, credit cards offer chargeback protection, allowing customers to dispute unauthorised transactions.
For high-value payments, businesses must weigh the benefits of UPI’s instant, secure nature against credit card dispute mechanisms to determine the best fit for their customers.
Why businesses should integrate UPI for high-value transactions
As UPI evolves beyond microtransactions, businesses stand to gain significantly by enabling high-value payments. From lower costs to better customer reach, here’s why UPI is becoming the preferred choice for large sales:
1. Lower transaction fees
One of the biggest advantages of UPI payments in India is cost efficiency. Unlike credit cards, which charge high processing fees, UPI transactions have minimal MDR. This makes high-ticket sales more profitable, allowing businesses to pass savings on to customers or improve margins.
2. Expanding customer base
While credit card penetration in India remains around 5%, UPI has over 350 million active users. Businesses integrating UPI for e-commerce can reach a wider audience, including consumers in tier-2 and tier-3 cities, where UPI adoption is booming.
Enabling UPI for high-value transactions ensures that businesses do not lose potential customers who lack credit cards but prefer digital payments.
3. Boosting conversions with UPI EMI
Affordability is key when selling high-ticket items. EMI on UPI allows customers to break payments into manageable instalments without requiring a credit card.
This makes premium products more accessible. Customers who previously hesitated due to upfront costs can now buy through flexible UPI-based instalments.
For businesses, adopting UPI EMI means higher sales, improved accessibility, and better customer retention—a win-win for both buyers and sellers.
Wrapping up!
UPI payments in India are no longer limited to small transactions. With high-value payments, EMI options, and global adoption, UPI is challenging traditional payment methods. While credit cards still offer benefits like rewards and credit lines, UPI provides a cost-effective, scalable, and widely accepted alternative.
Ready to integrate UPI for seamless high-value transactions? At Plural by Pine Labs, we offer cutting-edge UPIverse solutions to help businesses boost sales, reduce costs, and enhance customer experience. Our advanced UPI solutions ensure higher success rates, instant API integration, and same-day settlements.
Explore our UPI solutions or schedule a demo today! Write to us at pgsupport@pinelabs.com to learn more.
