The hidden cost of UPI resilience

India's digital scale risks undermining itself when regulatory quick fixes inadvertently shift systemic burdens onto merchants and end users alike

- SRINATH SRIDHARAN

THE RISE OF United Payments Interface (UPI) is among India's proudest digital triumphs. However, true strength in any infrastructure is measured not by its soaring growth curves, but by how it responds when cracks begin to show. In the wake of this year's UPI outages, a consequential recalibration has begun, revealing how India's most celebrated digital public goods weigh systemic resilience against genuine consumer protection. Faced with unexpected surges in transactions and conspicuous downtimes, the National Payments Corporation of India (NPCI) moved swiftly to announce measures that, at first glance, seem practical and prudent.

Daily caps on balance enquiries and account list application programming interfaces, tighter limits on autopay retries, and rules steering recurring deb-its away from peak hours—all were framed as tough-love regulations to protect a backbone that handles over ₹24 lakh crore each month. However, millions of consumers and small merchants will bear the brunt as they will be forced to rewrite operational routines around what the system can actually sustain.

The irony is striking. UPI Autopay accounts for barely 0.95% of monthly traffic, with around 175 million renewals out of 18.4 billion transactions. Even the most optimistic load relief from these throttles is symbolic. Yet even a modest 5% disruption carries a heavy toll—over ₹9,600 crore in lost annual sales, nearly ₹1,700 crore in tax shortfall, and quieter blows to households whose systematic investment plan (SIP) instalments bounce or children's fees miss deadlines.