Major UPI Outage Disrupts Payments Across India

MUMBAI, India – Users of major digital payment platforms in India faced significant disruptions Monday evening, as a widespread outage affected Unified Payments Interface (UPI) transactions. The issues began around 7:00 PM IST, leading to failed transactions and error messages on apps like PhonePe, Google Pay, and Paytm.

PhonePe, which processes nearly half of all UPI transactions in India, was the most heavily impacted. Rahul Chari, co-founder of PhonePe, explained that the outage resulted from a network capacity shortfall at a new data center that was handling all of the platform’s traffic during a disaster recovery drill. This drill was initiated due to recent geopolitical tensions.

As users flooded social media with complaints, Downdetector reported a sharp increase in UPI-related issues. Many users were unable to send or receive money, pay merchants, or access their linked accounts. Although Paytm’s CEO insisted their app was running normally, users reported problems with their transactions.

Banking apps from major institutions, including SBI, HDFC, and Axis Bank, also experienced issues, showcasing the ripple effect across the UPI ecosystem. Merchants who rely on UPI for payments reported losses and delays during peak business hours.

This incident is not isolated; UPI has faced multiple outages in recent months, typically during times of high transaction volumes. The National Payments Corporation of India (NPCI), which manages UPI, acknowledged these ongoing issues and has recently issued guidelines to enhance system robustness and prevent misuse.

Despite the outage inconveniencing users and businesses alike, PhonePe managed to redirect traffic and restore services within an hour. Many users were able to resume transactions by late evening. As UPI remains the default payment method for millions of Indians, experts are calling for continued investment and oversight to ensure its reliability.

As India’s digital payment ecosystem continues to evolve, the recent disruptions highlight the need for improvements to accommodate surges in demand. The incident emphasizes the critical role that UPI plays in the growing digital economy.