The So-Called “Failed” Challengers of UPI

Niti

• 2 min read
The So-Called “Failed” Challengers of UPI

For years, India’s UPI ecosystem has been defined by the dominance of PhonePe and Google Pay.
But around them, a set of challengers — Amazon Pay, CRED, Navi, Super.money, BHIM — are often dismissed as failures.

The popular narrative?

  • Amazon “wasted” ₹1,250 crore, sliding from 6th place to 8th.
  • CRED has burned ₹5,215 crore lifetime and still holds under 1% market share.
  • Navi is just another “cashback app” with 2.5% share.

At first glance, it looks like these bets have flopped.
But if you zoom out, a different story emerges.

The Patient Capital Reality

These apps aren’t losing — they’re laying foundations.

  • Navi processed 504M transactions (2.5% share) and now sits at #4, overtaking CRED.
  • Super.money clocked 257M transactions, growing at a steady 50%+ rate.
  • CRED, despite low volume, processed ₹55,756 crore in transaction value — showing strong traction with high-value users.
  • BHIM, with government backing, has returned to the top 10.

Individually, the numbers don’t look huge. But in the context of UPI’s scale, they tell a very different story.

The Market Context Everyone Misses

  • 🚀 UPI just crossed 20B monthly transactions for the first time.
  • 📈 That’s 34% YoY growth (up from 14.9B in August 2024).
  • 🎯 Each 1% share = 200M+ monthly transactions — bigger than most countries’ entire payment systems.

In such a fast-growing market, holding even a single percentage point is valuable. Scale comes from riding the wave, not just fighting the duopoly.

The Long Game: Beyond Payments

Here’s the key most people miss: these aren’t “just” payment apps. They’re building financial ecosystems.

  • Amazon Pay → Expanding into lending, insurance, wealth — part of Amazon’s full-stack fintech play.
  • Navi → Credit + investments, fueled by the Flipkart co-founder’s long-term vision.
  • CRED → Positioning as a premium wealth and lifestyle platform for affluent users.

The transaction share is just the tip of the iceberg. The monetization will come from financial services layered on top.

The 10x Growth Bet

India is targeting 1B daily transactions by 2027, compared to today’s 645M daily average.
Rural penetration? Still only 55%.

This isn’t a zero-sum game. The market is expanding faster than anyone can capture.

In a 34% YoY growth environment:

  • Today’s 2.5% market share can become a unicorn-scale business purely by riding expansion.
  • Challengers don’t need to “beat” PhonePe and GPay — they just need to endure.

Final Take

The “failure” narrative around UPI challengers is shortsighted.

What looks like wasted capital today is actually infrastructure investment for the next decade.
The real question isn’t who wins today’s tug-of-war.
It’s who will be ready when UPI is 10x bigger tomorrow.