How India’s Digital Payment Rails Are Crossing Borders
India’s government has transformed its payments ecosystem. State-led initiatives have digitized commerce while at the same time expanding the size of the market. Global corporates with a footprint in India are now positioning themselves for the next phase of this revolution, as India strives to grow its digital economy to the $1 trillion mark by 2030.
India is a pioneer of public works that are built not from concrete and steel, but from code and data. That includes the country’s state-led digital superstructure, which has expanded dramatically over the past decade, capturing the world’s attention while serving two key goals: to draw hundreds of millions of cash-dependent citizens into the digital economy, while also powering India’s digital economy towards the $1 trillion target.[1][2]
The foundation of this stack is the Aadhaar initiative (“Aadhaar” being the Hindi word for “base”), which gives every Indian a unique digital identity, linked to biometric data, for interacting with institutions, both public and private. A second layer is the Unified Payments Interface, or UPI, real-time payment rail designed to maximize inclusion in the digital economy—UPI now accounts for around 85% of digital retail payments in India.[3]
Then there is the Jan Dhan Yojana, which provides basic bank accounts and financial services to households that would otherwise lack them, and the Unified Lending Interface, designed to centralize data so that lenders can provide credit to smaller businesses with less friction in the process.[4][5]
A Springboard for Innovators
This digital public infrastructure is transforming India’s commercial landscape, placing payments at the heart of the country’s drive to build a trillion-dollar digital economy by 2030.[6] However, the India stack is not an end point, notes Rajagopal. Like roads and bridges, it’s intended for use by private citizens and businesses as an enabler of economic growth.
“The India stack is a springboard,” he says. “For example, it’s allowing fintechs, banks and insurers to build systems that use artificial intelligence and machine learning to hyper-personalize a service to individual customers. Embedded finance, which allows platforms to embed financial services capabilities such as payments, lending and insurance directly into their ecosystems, is a related growth area that is becoming increasingly common in the Indian market.”
This allows entrepreneurs to pioneer new business models, says Rajagopal, giving smaller players access to the kind of digital customer journey available to big brands.[8] Forecasts anticipate India’s e-commerce market to be worth $200 billion by 2026. “The next phase will be scaling ecommerce and connecting it seamlessly with global payment systems,” he says. “This is where global providers like J.P. Morgan Payments can help.”
Revisiting Remittances
The India Digital story is also spreading beyond the country’s borders, with remittances among the biggest drivers. For over a decade India has been the world’s largest market for remittance flows, with Indians in the diaspora sending home a record $135 billion in fiscal 2025.[9] This growth reflects the increasingly skilled and well-rewarded profile of India’s expatriate workers globally.
Less well known is that India is itself a growing source of outward remittances, for example for tourism or to Indian students studying in the UK or Canada.[10] Catering to both inward and outward flows requires new capabilities and skills, not least because outward remittances are closely scrutinized for tax compliance.
Merchants of the World
Another trend propelling the outward expansion of the India Stack is the growing internationalization of India’s economy, which is fueling demand for better payments options. Until recently, companies repatriating funds were largely limited to the SWIFT interbank payments system, but in 2023 the Reserve Bank of India launched the Payment Aggregator–Cross Border (PA-CB) designation, which authorized non-bank companies operate as aggregators. “An aggregator in the US, for instance, could consolidate money from buyers and then transfer it to an Indian aggregator who distributes it to the various sellers,” explains Rajagopal.
How this market evolves in the future depends on the internationalization of India’s UPI, he predicts. In 2023, the prime ministers of India and Singapore jointly announced the linkage of UPI to Singapore’s PayNow service, enabling customers of participating banks to seamlessly transfer funds between the two.[11]
The list of countries linked to UPI has since expanded to economies such as the UAE and France,[12] and it may prove an efficient solution for addressing the urgent need for seamless cross-border payments.
But while the systems are new, the challenges for cross-border payments are longstanding. Capital constraints, currency restrictions that trap cash in one market, complex tax systems, and regulatory burdens around KYC/AML must still be navigated. All these are often more challenging in India, due to the diversity of the market and the regulations that reflect its complexity. Fintechs, for instance, face added hurdles because they have limited direct access to clearing systems.
Experts like J.P. Morgan Payments help clients overcome that complexity by serving as a single point of contact for global corporates in India, whether for domestic collections, liquidity management, lending, merchant services or cross-border solutions. Ultimately, as India's digital infrastructure stack expands beyond its borders while transforming the domestic economy, companies operating in India will need a reliable payments partner to help navigate and capitalize on the opportunities offered by this evolving and dynamic market.
“By building partnerships and offering liquidity around-the-clock, we can provide corporate treasurers with comprehensive coverage within one overall relationship,” says Rajagopal. “As cross-border payments evolve, we help clients maximize the large and growing opportunity that India represents.”
