Growth in digital payment adoption in India is moderating but steady. Data from the RBI’s Digital Payment Index (DPI) show that expansion has stabilised at around 11 per cent year-on-year since FY23, marking a shift from the sharp acceleration seen during the pandemic years to a more measured phase of growth.

The DPI, with March 2018 as the base, climbed to 516.76 by September 2025, more than five times its initial level. In contrast, growth rates surged to 73 per cent in 2019 and remained above 30-40 per cent throughout the pandemic. The subsequent slowdown, economists say, reflects a natural base effect rather than a loss of momentum.

“When you are starting from a low base, growth rates tend to look very high. As the base expands, growth becomes more normal,” said Madan Sabnavis, Chief Economist, Bank of Baroda. He added that even as digital transactions rise, “the amount of cash in the system has also been increasing at a normal rate,” making very high growth rates increasingly difficult to sustain. “From one billion transactions, you cannot suddenly double to two billion; it takes time,” he said, explaining the moderation to the 10-11 per cent range.

Beneath the headline numbers, however, the data reveal sharp shifts across payment channels. Mobile-based payments continue to drive transaction volumes. In December 2025, mobile payment volume rose nearly 27 per cent year-on-year, while internet-based payments declined by about 8 per cent and cash withdrawals at ATMs fell by almost 10 per cent.

“The one significant metric for digital payment adoption is user convenience, and the channel that offers maximum convenience will see higher transaction volumes, which, very unsurprisingly, are mobile phones,” said Vivek Iyer, Partner and Financial Services Risk Leader, Grant Thornton Bharat. He noted that UPI’s ease of use for low-value transactions has made mobile phones the default payment interface.

However, in value terms, internet-based payments are gaining ground. Transaction value via internet banking rose by more than 24 per cent year-on-year in December 2025, outpacing mobile payments, which grew nearly 17 per cent. This suggests that while everyday spending is moving to mobile apps, higher-value transactions continue to favour traditional online banking channels.

The underlying payment infrastructure is also evolving. The number of prepaid payment instruments (PPIs) expanded by over 57 per cent year-on-year, while ATM numbers continued to shrink. According to experts, the decline in ATMs reflects the growing preference for digital channels over cash, even as access widens.

Looking ahead, Sabnavis expects growth to remain steady rather than revert to earlier highs. “The growth will definitely increase as more people adopt digital sources, but it cannot go back to 20-30 per cent levels,” he said. Instead, the next phase is likely to be driven by broader adoption, incremental innovation and deeper penetration into cash-dependent regions.

Published on February 19, 2026

 Credit guarantees worth ₹11,926 crore were sanctioned in 2022–23, rising to ₹23,359 crore in 2023–24 and touching ₹39,989 crore in 2024–25 
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Maharashtra has recorded a sharp surge in credit guarantees approved for Micro and Small Enterprises (MSEs), including those in rural areas, under the Credit Guarantee Scheme (CGS) of the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) over the past three financial years.

Data placed before the Lok Sabha show that the number of guarantees approved in the State increased from 66,055 in 2022–23 to 1,29,892 in 2023–24 and further to 2,38,128 in 2024–25

This marks a 3.6-fold rise in approvals within a span of two years, indicating a rapid expansion in access to collateral-free institutional credit.

The amount approved under the scheme has also seen a parallel increase. Credit guarantees worth ₹11,926 crore were sanctioned in 2022–23, rising to ₹23,359 crore in 2023–24 and touching ₹39,989 crore in 2024–25 . In absolute terms, the guarantee amount has more than tripled during this period.

Credit Push

The data, which include rural enterprises in Maharashtra , suggest growing reliance on the CGTMSE-backed lending framework among micro and small businesses. The scheme provides credit guarantees for loans extended to MSEs, with the ceiling for guarantee coverage fixed at ₹10 crore.  

The Centre has complemented this credit push with additional measures aimed at strengthening MSME financing. The Self-Reliant India Fund has been set up to infuse ₹50,000 crore as equity support in MSMEs , while the Prime Minister’s Employment Generation Programme offers margin money subsidy of up to 35 per cent for new micro enterprises .

Vishwakarma Scheme

The PM Vishwakarma Scheme provides loans up to ₹3 lakh with interest subvention support , and the Trade Receivables Discounting System enables digital financing of MSME receivables

The Ministry has also indicated that outreach programmes are conducted in coordination with District Industries Centres, banks and other stakeholders to expedite the flow of credit. The steep rise in guarantee approvals points to increasing formalisation of small businesses and stronger credit penetration in Maharashtra’s MSME sector, particularly among first-generation and rural entrepreneurs seeking collateral-free finance.

Published on February 19, 2026