Unified Payments Interface (UPI) services faced a major disruption across India on March 26, 2025, due to technical glitches. Users reported issues while making digital transactions through apps such as Google Pay, PhonePe, and Paytm. The outage, which began around 6:30 PM, peaked at 8:00 PM with over 3,000 complaints logged on Downdetector. While the National Payments Corporation of India (NPCI) assured users at 8:40 PM that the problem was resolved, complaints continued into the next morning.
This incident marks the fourth major outage of UPI in the past year. Similar disruptions occurred in February, June, and August 2024. The August outage was linked to a ransomware attack on C-Edge Technologies, which impacted small banks using UPI services. Despite these challenges, UPI remains India’s most preferred digital payment method. NPCI has acknowledged the need for further technical enhancements to prevent future disruptions.
The incident sparked humorous reactions on social media, with memes and jokes highlighting users’ frustrations. Many emphasized the importance of carrying backup cash in case of such outages. The outage also renewed discussions on improving India’s digital payment infrastructure, ensuring reliability, and reducing dependency on a single system.
1. Background on UPI and NPCI
1.1 The Unified Payments Interface (UPI) is India’s most widely used digital payment system. Launched in 2016 by NPCI, UPI enables instant money transfers between bank accounts via mobile devices. It supports peer-to-peer (P2P) and merchant transactions, making it a critical component of India’s digital economy.
1.2 NPCI, a non-profit organization under the Reserve Bank of India (RBI), manages UPI and other digital payment systems such as IMPS and RuPay. It was founded in 2008 to create a robust digital payment infrastructure for India. The organization operates under the guidance of India’s leading banks and financial regulators.
2. Revenue Model of NPCI
2.1 NPCI earns revenue primarily through transaction fees levied on merchants and banks. While P2P transfers remain free, merchant transactions generate revenue via interchange fees. Additionally, NPCI charges banks for providing UPI infrastructure and licensing services.
2.2 With rising UPI adoption, NPCI has expanded its revenue streams by launching value-added services like UPI AutoPay and cross-border payments. The introduction of credit on UPI is another significant step toward monetizing digital transactions.
3. Funding and Growth of UPI
3.1 NPCI operates as a public-private partnership with funding from major Indian banks. The organization has not raised external venture capital but has received government support to scale UPI nationwide.
3.2 UPI transactions have grown exponentially, surpassing 16.11 billion transactions worth INR 21.96 lakh crore in February 2025. This growth has positioned India as a global leader in digital payments.
4. Technical Glitches and Outage Timeline
4.1 The UPI outage on March 26, 2025, was among the most significant disruptions in recent months. The problem began at 6:30 PM and peaked at 8:00 PM, with users reporting failed transactions across platforms.
4.2 Downdetector recorded over 3,000 complaints within minutes, highlighting the widespread impact. NPCI initially remained silent but later issued a statement at 8:40 PM, assuring users that the issue had been resolved.
5. Previous UPI Outages
5.1 February 2024: UPI services were temporarily disrupted due to technical issues at partner banks.
5.2 June 2024: A lag in UPI payments led to delays in mutual fund transactions.
5.3 August 2024: A ransomware attack on C-Edge Technologies affected over 300 small banks, disrupting UPI services.
6. User Reactions and Social Media Trends
6.1 The UPI outage triggered widespread discussions on social media. Users shared memes, expressing frustration over failed transactions. Many joked about being unable to pay for food and essentials.
6.2 Popular memes included references to Bollywood movies, with one user quoting “Abhi Hum Zinda Hai” to highlight the relevance of cash payments.
7. NPCI’s Response and Future Improvements
7.1 NPCI has acknowledged the recurring outages and plans to implement more robust failover mechanisms. The organization aims to enhance server capacity and introduce additional security layers to prevent similar issues.
7.2 NPCI is also working on expanding UPI Lite, a feature designed to handle small-value transactions without depending on core banking infrastructure. This could help mitigate future disruptions.
8. Learning for Startups and Entrepreneurs
8.1 Infrastructure Reliability: Digital businesses must invest in robust infrastructure to handle high transaction volumes without downtime.
8.2 Backup Strategies: Companies relying on digital payments should have contingency plans, including alternate payment methods.
8.3 Security Measures: Startups must prioritize cybersecurity to prevent ransomware attacks that can cripple operations.
8.4 Customer Communication: Transparent communication during technical failures helps maintain trust and credibility.
8.5 Scalability Planning: Growing digital platforms should proactively upgrade their systems to meet increasing demand.
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