Visa is intensifying its efforts to boost merchant acceptance in India, aiming to compete with the widely adopted Unified Payments Interface (UPI). Ramakrishnan Gopalan, chief product officer for India and South Asia at Visa, emphasized consumer choice as a primary strategy, advocating for cards to remain a vital part of the payment mix. This comes as India had approximately 110 million active credit cards and one billion active debit cards as of March 2026, despite UPI processing a record 22.64 billion transactions worth ₹29.53 trillion ($354.36 billion USD) in March 2026 alone, accounting for 84% of India’s digital payments volume in 2025.
Visa's strategy includes making card acceptance more affordable for merchants, developing low-cost acceptance devices, and enabling NFC-enabled smartphones to function as card machines. Gopalan indicated that Visa is prepared to adjust its pricing to compete with QR-based payments where cards are perceived as more expensive. The company has also forged partnerships with Indian entities to create all-in-one payment solutions and implemented card-on-file tokenization, which has seen significant adoption with over 550 to 600 million tokens in the market.
Beyond direct competition with UPI, Visa aims to formalize India's $1 trillion cash economy, viewing it as a significant untapped market. Initiatives like 'Visa Payment Passkey' are being introduced to streamline authentication by reducing reliance on OTPs, and 'Visa Flexible Credential' allows users to switch between debit and credit functionalities on a single card. This innovation, already successful in Japan, addresses the common issue of Indians carrying multiple payment cards and aims to provide a smoother, frictionless experience by allowing users to set rules for how their single 16-digit credential functions for different types of transactions. Visa acknowledges the challenge posed by the zero Merchant Discount Rate (MDR) for UPI and RuPay transactions, making them less costly for micro-merchants.
